CP2057 Notice: Changes to Your Information Return

The CP2057 Notice is issued by the IRS to notify taxpayers that changes have been made to their information return, such as W-2s or 1099s, based on discrepancies between the taxpayer’s reported income and what the IRS has on file.

Key elements of the CP2057 Notice:

• Explanation of Adjustments: The notice explains the discrepancies found in the taxpayer’s information returns, such as differences in reported income, deductions, or credits. The IRS may have adjusted the return based on third-party information, like employer-reported W-2s or 1099s.
• Impact on Tax Liability: If the adjustments result in a balance due, the notice will include the amount owed and instructions on how to pay. If the changes reduce the taxpayer’s tax liability, the notice may indicate a refund or credit.
• Next Steps: Taxpayers are encouraged to review the changes and ensure the adjustments are accurate. If they agree with the changes, they can pay any balance owed. If they disagree, they can dispute the adjustments by providing additional documentation.
• Dispute Process: The notice includes instructions on how to dispute the IRS’s findings if the taxpayer believes the adjustments were made in error. Supporting documents, such as corrected W-2s or 1099s, may be required.

The CP2057 Notice is essential for taxpayers to review carefully, as it can impact their tax liability by correcting discrepancies in reported income or deductions.