I received a summary of proposed changes from the IRS

[Tempus]

Asking me to pay a significant amount by Feb 2nd, stating I made more then I did.

[Critter]

Review the CP2000 notice carefully ... what exactly are they changing ?   Are they correct ?

[Tempus]

Taxable income, line 27 IRS corrected shows just over 20k more then I made in the year, Income tax withheld is lower then what was withheld by about 3k, looks like most of it is accounted by Nonemployee compensation, but the company reporting it I was employees there as a w-2 as of Jan 1st that year so I shouldn't have any non employee compensation.

[Tempus]

also theres withholdings from that same company as an employee I missed on the back of the page.

[Tempus]

Changes:

Nonemployee compensation 0 to 29k
self employment tax deduction 0 to 2k
student loan intrest deduction 1169 to 0
taxable income line 27 38k to 70k
tax line 28  5k to 13k
self employment tax 0 to 4k
total tax owed 6k to 18k
income tax withheld 6.4k to 3.7k

I made 50k between 2 employers that year both as w2 and withholding taxes. This correction shows me making just over 70k, and having far less taken out of my paycheck then occurred.
The numbers that seem to be wrong seem to all stem from 1 employer, who I left on bad terms with because he wasn't paying me. I didn't get tax info from him except for the ladder half of the year, after we switched to an external payroll provider.
I don't know how to proceed at this point.

[Lisa995]

Non Employee Compensation     Did you receive a 1099MISC for 29K for the year they are questioning?  That would be considered Self Employment income, not Wages.   Looks like it wasn't included as such.  

It should show in the list who issued that 1099MISC to you.

[Tempus]

The CP2000 says there was, but I didn't do any contracting work that year, and did not receive a 1099 for the year in question, or for 29k any year for that matter. One of my employers did report both W2 and 1099misc however according to the CP2000, neither for correct amounts but this is in error.
A little background on the situation, the owner always had issues with paying me. I was a 1099 for the first few years with him, but that changed Jan of the year in question. I didn't get my first paycheck for work in Jan until later in the year, but instead paycheck stubs and a promise of getting paid when the money was available. When he paid me, it was what was on the paycheck stubs times the number of months he hadn't paid me. which happened when we swapped payroll providers. Its the information from when he was handling payroll himself that wrong, but I quit working there before he send w2's out and only received the one the payroll provider sent, for the last half of the year.

[Critter]

Sounds like you did fail to report all the income ... just because you didn't receive the tax forms you still had to report the income. If you believe all the income should have been on a W-2 not a 1099 then that is something you can argue. Or if you have expenses against that income you can amend the return and add the Sch C with expenses. What worries me the most is that you had pay stubs with withholding that the employer didn't remit to the IRS.   You may want to get an attorney that deals in employment law as you may have action for a lawsuit.   It may be best to get some professional help with this notice since there are a lot of moving parts ....

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