Filed taxes incorrectly 3 years ago - Now owe $3,000 - How to identify the error?

Several common errors could lead to a $3,000 tax bill. Based on the timeline, this would be for tax year 2021 (filed in 2022), which had some unique considerations. The IRS typically sends CP2000 notices by September 2023 for 2021 returns, so the timing makes sense. Common errors include: 1. Missing income (did you have multiple W-2s or 1099s?) 2. Incorrectly claimed credits (particularly pandemic-related ones) 3. Deduction errors (especially if you were self-employed) 4. Math errors when calculating taxes Your first step should be to carefully review the notice itself. It should specify exactly what the IRS believes you reported incorrectly. Then compare that to your original return. You have the right to contest this within 30 days of the notice date.

Did the notice specifically mention which items were incorrect on your return? I'm trying to understand if this is related to unreported income or incorrect deductions. Also, what type of notice did you receive - was it a CP2000 (proposed adjustment) or a different notice type? The specific notice matters because it affects your response options and deadlines.

Been thru this exact thing last yr! The IRS phone lines are IMPOSSIBLE rn - I spent 3 days trying to get thru w/ no luck. Finally tried Claimyr (https://youtu.be/_kiP6q8DX5c) and got connected to an agent in like 25 mins. Totally worth it for peace of mind! The agent walked me thru exactly what was wrong w/ my return (missed a 1099 from a temp job) and helped me set up a payment plan since it was legit my mistake. Saved me SO much stress vs trying to figure it out alone.

When I got hit with a similar notice last year, I found that going to a local Taxpayer Advocate Service office was incredibly helpful. They're an independent organization within the IRS designed to help taxpayers. I had tried calling the main IRS line multiple times before that with no success. The advocate helped me understand exactly what went wrong (in my case, I had incorrectly reported some investment income) and guided me through the response process. You can find your local office on the IRS website.

I'm a bit concerned about the 3-year timeline here. The IRS usually has to assess additional tax within 3 years of when you filed. If you filed in 2021 for 2020 taxes, we're right at that cutoff now in 2024. Compared to other situations I've seen, this timing seems suspicious. Did you verify the notice is legitimate? There are a lot of IRS scams going around, especially during tax season.

LOL at "I did it myself for the first time" - welcome to the club of "I'll never do that again"! 😂 But seriously, don't panic. I was shocked when I got a $4,200 bill from the IRS two years ago. Turned out I had completely messed up reporting my crypto trades (who knew you had to report EACH transaction?!). The good news is that if you respond to them with a reasonable explanation and are willing to work with them, they're actually not the monsters everyone makes them out to be. They put me on a payment plan with minimal hassle.

Before you do anything else, make sure to carefully read through every page of the notice you received. The IRS notice should include a detailed breakdown showing exactly what they believe you reported incorrectly versus what they have on file. Look for things like: - Unreported W-2 or 1099 income that employers/clients sent to the IRS - Incorrect Social Security numbers or dependent information - Math errors in calculating your tax liability - Incorrectly claimed deductions or credits The notice should also clearly state your response deadline (usually 30 days) and provide instructions for how to respond if you disagree. If you agree with their assessment, you can simply pay the amount owed. If you disagree, you'll need to send a written response with supporting documentation. One thing to keep in mind: if this is legitimate, acting quickly is important. The longer you wait, the more interest and penalties will accumulate. But don't rush into paying without understanding what went wrong - you have rights as a taxpayer to dispute incorrect assessments.