An IRS notice about crypto taxes. Start with the notice.

Keep the deadline and the tax question together

Keep every page of the notice, identify the tax year and notice code, and note the response date. Compare the questioned items with the return you filed and the records used to prepare it. Different letters require different actions; the code and instructions determine where the review starts.

A CP2000-series notice proposes changes because third-party information differs from the return. The IRS describes it as a proposed change, rather than a bill. Read the complete notice before deciding whether to agree, disagree or provide additional information.

1. Identify the notice before preparing a response

Record the notice code, tax year, date received and requested response date in one place. Keep any response form and instructions with the letter. A request for documents, a proposed adjustment and a payment notice should not be treated as interchangeable.

If the letter's authenticity is uncertain, use IRS.gov to locate the official information for its code. Ask the professional reviewing the issue to confirm what the notice requests before transmitting records.

• Notice code and affected tax year
• Response date printed on the notice
• Items and amounts the notice questions
• Any response form and delivery instructions
• A record of previous replies about the same issue

2. Build a comparison for the questioned transactions

For a crypto reporting question, prepare a comparison between the notice, the relevant broker document, the filed return and the underlying transaction history. Explain which source supports each sale, acquisition or correction. A software total covering several platforms needs to be separated from a statement covering one broker.

If acquisition information is missing from a statement, collect the purchase records and transfers that explain it. Also check whether a corrected broker document was issued after the return was prepared.

3. Choose the response procedure with the reviewer

Follow the instructions and deadline of the specific notice. For CP2000, agreement that resolves the issue without other changes generally does not require an amended return. When the notice is correct but additional income, credits or expenses also need reporting, the IRS describes submitting Form 1040-X with the notice response.

A standalone amended return should not be assumed to satisfy a separate notice response. Preserve a copy of the agreed response and evidence of its submission. If there are related questions about another year, document those as separate review items.

4. Make the initial consultation request specific

Your first message to Nancy can state the notice code, tax year, response date and the crypto reporting issue. Mention which records you have and whether you have already replied. This helps establish whether the question fits an available consultation and how time-sensitive it is.

Document review, drafting a response, amended-return preparation and contacting the IRS are separate scopes. Confirm the work and any required authorization before expecting a professional to respond on your behalf. Share the complete notice through the document-sharing method agreed for the engagement.

Common questions