If you report income on your return that doesn’t match what’s been reported by banks, brokerage firms, and other third parties, to the IRS, you may receive IRS Notice CP2000 (FS-2019-10). This notice informs you of the mismatch and gives you steps for resolving the issue. Technically, this isn’t an audit. The IRS is just checking to see whether you agree or disagree with the tax changes that the IRS proposes. You should respond within 30 days of the date printed on the notice. The notice contains a telephone number you can call for additional information or help.
If you fail to timely respond to the CP2000, then the IRS will send you Notice CP3219A, Statutory Notice of Deficiency. This notice is a formal notice that starts the clock on your ability to challenge the IRS determination in Tax Court.