A CP12 notice is a letter sent by the IRS to notify you of a math error in calculating your tax refund. The IRS sends this notice in two situations.
One, when it corrects a mistake on your tax return that results in a different tax refund amount from what you calculated.
Two, when it corrects a mistake that results in a tax refund when you believed, and your tax return reflected, that you owe the IRS money.
Oftentimes, you don’t have to take any action after receiving a CP12 notice, particularly when the notice informs you that you’ll be receiving more of a tax refund than you expected. But if you don’t agree with the IRS’s recalculation of your tax return, there are steps you can take to get them to reverse the changes.
What Is a CP12 Notice?
A CP12 notice is also known as a “Math Error Resulting in Overpayment” notice. The IRS sends a CP12 notice when it detects a math error on your tax return that affects what your tax refund should be. A CP12 notice will either indicate that you’ll be receiving a different tax refund amount or that you’ll be receiving a tax refund rather than owing the IRS money.
Why Did I Receive a CP12 Notice From the IRS?
You received a CP12 notice from the IRS because they reviewed your tax return, determined that there is a math error, and corrected the error. Very often with CP12 notices, the math error correction favors you — you either receive a bigger tax refund than originally calculated, or you receive a tax refund rather than having to pay the IRS.
What Are the Types of Mistakes the IRS Corrects on Tax Returns Before Sending a CP12 Notice?
The IRS corrects mistakes in calculating your total tax liability for the year versus the amount you already paid via withholding. Many taxpayers have more money withheld from their paychecks throughout the year than is needed to cover their tax liability. The extra withholding is what gets returned in the form of a tax refund.
If your tax return either overstated your total tax liability or understated what you had withheld and the IRS catches the math error, they will correct the error, amend your tax refund amount, and send you a CP12 notice.
How Can I Find Out What Mistakes the IRS Corrected on My Tax Return When I Receive a CP12 Notice?
The CP12 notice will convey the basic information about what the IRS corrected on your tax return. If you want a more detailed explanation, the CP12 notice will include a toll-free number in the top right corner that you can use to contact the IRS.
What Should I Do if I Receive a CP12 Notice and Agree with the Tax Return Changes Made by the IRS?
If you agree with the tax return changes made by the IRS in your CP12 notice, you don’t have to do anything at all, although it is a good idea to amend your copy of your tax return so that it matches the changes made by the IRS.
If you don’t have any other federal debts to be applied, you should receive your tax refund in four to six weeks.
What Should I Do if I Receive a CP12 Notice and Disagree with the Tax Return Changes Made by the IRS?
If you disagree with the changes in your CP12 notice, you should call the toll-free number listed on the letter or respond to the IRS by mail. If you do this within 60 days, the IRS should reverse the changes, meaning you’ll receive the tax refund you anticipated.
However, if you fail to supply adequate documentation showing why your original figures were correct, the IRS will forward your return to its Examinations department for an audit. Also, if you owe back taxes when you receive a CP12 notice, the IRS Fresh Start Program can help you find tax relief.
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