Right after the IRS finds that the income is underreported; it begins with its own sets of processes and procedures. The IRS would go on to send you a letter to inform you they found a discrepancy and that you may have unpaid taxes. You are then left with 2 options. You can either dispute the discrepancy or make arrangements to pay the amount that is pending. Businesses always tends to pay lesser tax and would show lesser income which could sometimes prove to be a major issue. The only way to pay less in taxes is to show that the business has not been able to gain significant profit. Underreported income may not become a huge issue to deal with in such cases.

What to do next?

In any case you underreported your income on your tax return then you have come to the right place. Here you will find a complete overview of what to anticipate if you file a tax return with your income underreported. The IRS generates and sends a Notice CP2000 if it finds out that you have underreported your income in any way. Notice CP2000 would provide for some suggestions to changes in your income. There is no need to file an amended notice all the time.

Respond to IRS after the notice is sent

In fact, there is no need to file an amended return if you receive Notice CP2000. On the other hand, it becomes very important that you carefully review the information on it for accuracy. This process will make the needed changes to your filing. Be that you agree with the changes in the notice, you must send a response to the IRS. The IRS will send along a response form, a payment slip, and a return envelope with the Notice CP2000. Tax Relief Professional services offer the best support.