Affects 1.9 million Americans annually and the IRS adjusts returns automatically by notice by mail.
- Individuals only
- Most common error is incorrect tax calculation
- IRS adjusts return automatically by notice
“I made an error and the IRS adjusted my refund/balance owed”
The Internal Revenue Service (IRS) sends notices to taxpayers when there’s an inconsistency on their return. These notices often lead to taxpayers owing more on their taxes than they thought. What should you do if you get one of these notices? Below is an overview of IRS math error notices and what to do about them.
What Are IRS Math Error Notices?
A math error notice means that the information the IRS has on file for you is different from the information you submitted on your tax return. This could be because you made a mistake when preparing your return or because the IRS has incorrect information.
“Despite their name, math error notices aren’t just about arithmetic,” says the Wall Street Journal. “Instead, they are tax adjustments for a variety of issues detected by IRS computers during return processing.”
Errors that Generate IRS Notices
The IRS shares the following examples of mistakes that may generate IRS math error notices:
- Simple errors in math or data entry.
- Accidentally including the wrong information from tax tables, schedules, etc. (Note: this must be an obvious accident based on other information you provided on the return.)
- Incorrect entries on a schedule, form, or statement.
- Missing supporting documentation for an entry on the return.
- An entry on a return that exceeds a statutory limit if the limit is a monetary figure, a percentage, a ratio, or a fraction, and if the items you entered into the application of this limit appear on the return. This one is a bit tricky, so here’s an example.
A taxpayer claims an Individual Retirement Account (IRA) deduction even though their modified adjusted gross income is over the statutory limit allowed for claiming an IRA deduction. These details must be accurate to avoid IRS math error notices.
Additional Errors that Generate IRS Notices
- Missing or incorrect Taxpayer Identification Numbers (TINs) for the primary and/or secondary taxpayers, dependents, or any other individuals that you named when claiming certain tax benefits, such as the Child Tax Credit (CTC), Earned Income Tax Credit (EITC), and more.
- Missing or incorrect TIN(s) for the qualifying person when claiming the Child and Dependent Care Credit.
- Claiming certain credits, like CTC and/or EITC if the IRS didn’t allow it in the previous year through deficiency procedures, and you didn’t file Form 8862 with your return. This is an exception to this rule. Contact your tax professional for more information.
- A claim for EITC based on self-employment income that you didn’t pay self-employment tax on.
- A claim for EITC when the taxpayer(s) don’t meet the age requirements and have no qualifying child.
- Including the TIN of an individual whose age doesn’t correspond with the calculations on the return. For example, a taxpayer claims the CTC for a dependent who turned 17 before the end of the tax year (other than 2021).
Math Errors that Don’t Generate IRS Notices
On the other hand, the computer system does not consider the following inaccuracies when generating IRS math error notices.
- Corrections to withholdings or estimated tax payments
- Any changes that result in a larger refund than the taxpayer would’ve received without the changes.
The Most Common IRS Math Error Notices
Math error notices affect about 1.9 million Americans annually. There are a few versions of the notice a taxpayer can receive under the “math error” umbrella. According to the Taxpayer Advocate Service (TAS), the three most common notice numbers are CP11, CP12, and CP13. Here is what each means.
- CP11: The IRS fixed a miscalculation on your tax return. As a result, you owe money on your taxes.
- CP12: The IRS fixed at least one mistake on your tax return. As a result, the IRS owes you a refund, or your original refund amount has changed.
- CP13: The IRS made changes to your return due to a miscalculation. As a result, your account balance is zero.
What to Do if You Receive a Math Error Notice
If the IRS has found a discrepancy in your tax return, then it sends a notice requesting that you correct the error. You have a strict deadline of 60 days to resolve the issue. If the issue isn’t resolved in 60 days, the IRS begins collection efforts immediately. Here are the steps you should take after receiving one of these IRS math error notices:
- Review the notice carefully. Try to understand the error and the requested correction.
- Check your tax return to see if you can find the error.
- A. If you find the error and agree with the correction, make the necessary changes to your tax return. Then send it back to the IRS along with a copy of the math error notice.
- B. If you disagree with the correction, take your next steps with care. Firstly, gather any supporting documentation you can use as evidence to support your case.
Pro Tip: Make copies. Always keep your original documentation and send copies to the IRS.
Secondly, craft a letter explaining your position to the IRS. This letter is often the key to an IRS agent’s decision in these cases.
Getting Help with Math Error Notices Now is Essential
It is important to respond to math error notices as soon as possible. Failing to do so can result in additional fees and interest. Taxpayers have 60 days from the date on the notice to respond.
If the IRS doesn’t receive your response by the deadline, then it locks in the changes it proposed in the notice. As we mentioned above, collection efforts begin immediately.
Sometimes IRS math error notices are hard to understand. “Unfortunately, because the math error notices do not clearly articulate what was adjusted and why,” says TAS, “taxpayers are often left confused as to what changes have been made to their return, making it difficult for taxpayers to determine whether they agree or disagree with the changes.”
If you are unable to identify the mistake or if you disagree with the IRS’s assessment, get the help of a tax professional now. A tax professional can review your return and help you determine the best course of action. They can craft your response letter for you. They can also represent you before the IRS if necessary.
Advanced Tax Team is standing by ready to provide you with a free consultation. We’ll discuss your case in detail and answer your questions. You’ll gain a clearer understanding of your options with no strings attached. Call us today and sleep better tonight.
- “21.5.4 General Math Error Procedures: Internal Revenue Service.” 21.5.4 General Math Error Procedures | Internal Revenue Service, https://www.irs.gov/irm/part21/irm_21-005-004r#:~:text=In%20math%20or%20clerical%20error,tax%20specified%20in%20the%20notice.
- Professionally reviewed by David J. Allen. “IRS Math Error Notices.” Tax Relief Professional, 8 Dec. 2022, https://taxreliefprofessional.com/math-error-notices.
- Author Clinton F Wassor on November 30, and Professionally reviewed by Drew O. Mark. “IRS Wage Garnishment Release.” Tax Relief Professional, 30 Nov. 2022, https://taxreliefprofessional.com/irs-wage-garnishment-release.
- Keeling, Toni. “NTA Blog: Math Error Part I.” Taxpayer Advocate Service, 15 Apr. 2022, https://www.taxpayeradvocate.irs.gov/news/nta-blog-math-error-part-i/.
- “The Latest IRS Headache for Taxpayers: 11 Million ‘Math Error’ Notices.” The Wall Street Journal, Dow Jones & Company, 3 Sept. 2021, https://www.wsj.com/articles/the-latest-irs-headache-for-taxpayers-11-million-math-error-notices-11630661402?mod=hp_featst_pos3.
- NTA Blog: Math Error Notices: What You Need to Know and What the IRS … https://www.taxpayeradvocate.irs.gov/news/nta-blog-math-error-notices-what-you-need-to-know-and-what-the-irs-needs-to-do-to-improve-notices/.