Received CP3219A notice after responding to CP2000 for crypto losses - what now?

What you're dealing with is the IRS notice timeline overlap issue. The CP3219A is actually a Notice of Deficiency, which is more serious than the CP2000 (which was just a proposed assessment). You absolutely need to respond to this new notice. It's likely that your amended return is still in processing (the IRS is currently taking 16+ weeks for amended returns) and this notice was automatically generated before your response was fully processed. The CP3219A gives you 90 days to either pay the amount or petition the Tax Court. I'd recommend calling the IRS at the number on your notice to confirm they received your previous response. Ask them to document in their system that you've already responded to the CP2000 with documentation showing crypto losses. Request that they put a hold on any further collection activities while they process your amended return.

I went through almost the exact same situation last year with crypto reporting issues. After weeks of getting nowhere with the IRS phone lines, I found taxr.ai (https://taxr.ai) which helped me sort through all my crypto documentation. They have AI tools that analyze your IRS notices and crypto transaction history to identify exactly what the IRS is misinterpreting. In my case, they helped me organize my documentation to clearly show that I had losses, not gains. The IRS was counting transfers between my wallets as taxable events when they weren't. The service created a response packet that laid everything out so clearly that my case was resolved within a few weeks after months of back and forth.

Just wanted to update everyone - I ended up trying taxr.ai after reading about it here and it was exactly what I needed. The system identified that the IRS was treating my wallet-to-wallet transfers as taxable events, which was causing them to think I had unreported gains. The service created a detailed response package that showed my complete transaction history with each event properly classified. I submitted this to the IRS three weeks ago in response to my notice, and I just got confirmation yesterday that they've accepted my documentation and closed the case! No more tax bill. This saved me from having to pay nearly $4,200 in incorrect taxes plus penalties. If you're dealing with crypto tax notices, definitely worth checking out.

I was in almost the exact same position last year with a CP3219A notice that came after I had already responded to a CP2000. The most frustrating part was trying to get someone at the IRS on the phone to confirm they had my documentation. I spent hours on hold only to get disconnected. I finally tried https://claimyr.com and their service actually got me connected to an IRS agent in about 20 minutes instead of the 2+ hours I was spending on hold. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. The agent was able to confirm they had received my documentation but it was sitting in a processing queue, and she put notes in my account about the situation. Having an actual conversation with the IRS made all the difference - they put a hold on further notices while my case was being reviewed, which gave me peace of mind.

I have to admit I was wrong about Claimyr. After getting another IRS notice yesterday, I decided to give it a try since I was going to have to call anyway. I was absolutely shocked when I got a call back in about 35 minutes saying they had an IRS agent on the line ready to talk to me. The agent was able to pull up my account and confirm they had received my documentation for my CP3219A response, but it hadn't been processed yet. She put notes in my file and assured me that no further action would be taken while my amended return was being reviewed. She even gave me a specific timeframe for when I should check back if I don't hear anything. This saved me from submitting duplicate documentation and potentially confusing my case further. Definitely worth it after all the hours I've wasted on hold in the past.

Something important to note about the CP3219A - it's a 90-day letter that gives you the right to petition the Tax Court BEFORE paying the tax. If you don't respond within 90 days either by petitioning the Tax Court or by reaching an agreement with the IRS, they will assess the tax and you'll lose your right to Tax Court without first paying. I learned this the hard way last year. Even if you think your amended return will eventually fix the issue, don't ignore the CP3219A deadline. At minimum, call the IRS to confirm they've received your documentation and ask for a hold on further action.

Don't overlook the fact that the CP3219A means the IRS has officially rejected the explanation you provided for the CP2000. The automatic generation theory might be true, but you need to treat this seriously. I recommend sending a formal protest letter along with your response. Include a timeline of all communications, copies of everything you've sent before, and specifically request abatement of any penalties since you responded timely to the CP2000. Also specify that you're contesting their determination on the basis that you properly reported your crypto transactions and actually incurred losses, not gains.

I dealt with this exact situation last year with my 2020 crypto taxes. The key thing to understand is that the IRS computer systems don't talk to each other very well. Your CP3219A was likely auto-generated before your amended return response was processed - this is incredibly common. Here's what worked for me: I immediately called the IRS using the number on the CP3219A notice and asked them to check if they had received my previous response to the CP2000. The agent confirmed they had it but it was sitting in a different department's queue. She was able to put a "hold" code on my account to stop any further automated notices while my case was being reviewed. The most important thing is NOT to ignore the CP3219A deadline. Even though you already responded once, treat this as a separate notice that requires a response within 90 days. Send copies of everything you sent before, but also include a cover letter that references both notice numbers and explains the timeline of your responses. One more tip - make sure you're sending your response to the correct address listed on the CP3219A notice, as it's often different from the CP2000 response address. Good luck!