CP2000 is a federal (IRS) program. It compares the income and deductions reported on your federal tax return with information reported from other sources (e.g., employers, banks, businesses). If the amounts don’t match, the IRS adjusts your tax return and mails you a CP2000 notice.
What to do after getting an IRS CP2000 notice
Income and deduction amounts on your Idaho tax return must match those reported on your federal tax return unless an Idaho or federal law says otherwise.
You must contact the Tax Commission if the IRS has adjusted your federal income tax return. You must do this within 120 days of the final federal determination to avoid a negligence penalty. Interest accrues on any amount you owe, starting after the due date of the original return.
You can either:
- File an amended Idaho individual income tax return. Attach a copy of your federal CP2000 notice and any other relevant documents.
- Provide the Tax Commission with a copy of your federal CP2000 notice and any other relevant documents.
Mail to:
Tax Discovery Bureau – CP2000
Idaho State Tax Commission
PO Box 36
Boise ID 83722-0410
IRS notifies Idaho
The IRS forwards information on its CP2000 audits to many states, including Idaho. This can occur years after the IRS contacts you. This is one reason why it’s important to contact us promptly. If you don’t file an amended return or notify us, we can adjust your return to make it match the IRS’s findings at any time in the future.
Note: You might lose the ability to claim a refund if you don’t amend within one year of the federal CP2000 audit notice.
How Idaho will notify you of the CP2000 adjustment
We’ll mail you the Idaho CP2000 Billing Letter if you don’t file an amended return. This letter gives you 28 days to either pay or protest.
Paying
If you agree with Idaho’s calculation of tax, you can either:
- Pay the balance in full. See how to make payments.
- Set up a payment plan. Sign, date, and return the Consent to Assessment (CTA) attached to the Idaho CP2000 Billing Letter. We’ll mail you a bill after we receive the signed CTA.
Protesting
If you don’t agree with Idaho’s calculation of tax, you have the right to protest. Read about CP2000 protests below.
Protest
If you disagree with the IRS’s CP2000 notice, follow the instructions provided with the notice. You can also:
- Contact the IRS and request a Tax Account Transcript for comparison.
- If the Tax Account Transcript differs from the federal CP2000 notice, send the Tax Commission copies of the transcript and the federal CP2000, along with an explanation of the difference. Mail the documents to:
Tax Discovery Bureau – CP2000
Idaho State Tax Commission
PO Box 36
Boise ID 83722-0410
If the Tax Account Transcript is the same as the Idaho CP2000 data and you don’t agree with it, you must contact the IRS to submit a request for corrections. If the IRS adopts those changes, Idaho can follow suit.
If not corrected by IRS
If you don’t agree with the CP2000 adjustment and it hasn’t been corrected by the IRS, you can dispute the Idaho adjustment by filing a written protest within 63 days from the date we issue the Notice of Deficiency Determination (NODD). Send your protest to the Tax Commission at the address shown on the NODD. For your written protest to be accepted, it must include these four items:
- Your name, address, and taxpayer identification number.
- The tax period(s) covered by the protest.
- The specific item(s) in the NODD to which you object.
- The specific legal or factual reason(s) you think the notice is in error.
Once we receive your protest documents, we’ll review them to be sure the required information is included (see above).
- If your protest isn’t acceptable, we’ll send you a letter telling you the information we need. You must respond within 28 days. On the 29th day, your protest expires and the NODD becomes due and payable.
- If your protest is accepted, we’ll send you a letter acknowledging your protest within 14 days after receiving it.
Additional information
After you file your protest, you can provide more supporting information for us to consider. If we agree to change the amount due based on the new information, we’ll send you a modified report.
Paying to stop interest
You can stop interest from accruing by paying the balance on the CP2000 Billing Letter or the NODD. This won’t influence your protest, and you’ll get a refund if we determine you don’t owe all or part of the extra tax.
Unable to agree
If we’re unable to agree on the resolution of the issues, your file will be transferred to the Tax Commission’s Appeals department. They’ll send you a letter explaining the appeals process, including your hearing rights and how to submit additional information.
Read more about the protest process on the Your Right to Appeal a Notice of Deficiency Determination page.
You can read more about your rights on our Taxpayer Rights page.
Laws and rules
- Notice of redetermination or deficiency, interest — Idaho Code section 63-3045
- Penalties and additions to the tax in case of deficiency — Idaho Code section 63-3046
- Period of limitations for issuing a Notice of Deficiency and collection of tax — “…adjusted as a result of a final federal determination…” [Idaho Code section 63-3068(f)]
- Notice of adjustment of federal or state tax liability — Idaho Code section 63-3069
- Credits and refunds — “…the period of limitations for claiming a refund or credit…” [Idaho Code section 63-3072(d)]
- Income Tax Administrative Rule 890
- Idaho Tax Administration and Enforcement Rule 410
Additional help
- Contact us if you have questions on CP2000 audits.
Federal Filing Changes and Your Idaho Income Tax Return- If you’d like someone else to represent you during your audit, complete and return this Idaho Power of Attorney (POA) form.