Hi, my name is Aaron I’m looking for advice because I received a CP 2000 form proposing a grossly huge number that I owe ($120,000) and then it shows that I had forgotten to report a 1099 form from Robinhood crypto brokerage that I used back in 2021. I found the form I need to show. I never made any significant gains throughout my transactions if anything, I believe I was at a loss. I’m just looking for advice whether I should amend the past tax return, or reply to the CP 2000 saying I disagree with a copy of the 2021 1099 form? Any help is appreciated Thankyou
you can't just forward a 1099-B to the IRS.
you will have to amend your tax return (Form 1040-X) to show on Form 8949 the cost basis col(e) for your proceeds col(d) so that it is not all taxable
I would be replying in writing to the letter to tell the IRS you will be filing an amendment within the next three business days.
when filing 1040-X on paper,
Do not include your old 1040 nor your revised 1040 because the Form 1040-X reflects any changes there and becomes your new tax return.
You did not say what the IRS told you to do.
Follow the instructions in the letter from the IRS.
It should tell you how to dispute.