IRS Notice CP3219A: What It Is and How to Respond
IRS Notice CP3219A is the 90-day letter issued by the IRS Automated Underreporter (AUR) Program to a taxpayer after it has sent a 30-day letter (typically in the form of Notice CP2000) that the taxpayer did not respond to or that the taxpayer did respond to but IRS AUR did not process the response promptly.
As a 90-day letter, IRS Notice CP3219A is a statutory notice of deficiency that, if not responded to within 90 days of the date on the letter itself, will result in the IRS assessing the taxes, penalties, and interest described in the letter.
The CP3219A is typically accompanied by the IRS Form 5564, Notice of Deficiency Waiver, that a taxpayer can sign if they agree with the IRS’s proposed assessment — this form should generally not be signed and submitted to the IRS without first consulting with a tax professional about the implications of doing so.
The IRS has since given this notice a new look. Here is a redacted CP3219A, together with its Form 5564, that one of our clients received in January 2025 (PDF).
What Is Assessment?
The assessment of a tax is the formal recording of a taxpayer’s tax debt — including penalties and interest — in the government’s books, that is, its financial records.
Why does this matter to you? The main reason is because according to Internal Revenue Code § 6502 “Collection After Assessment”, the IRS must assess a tax before attempting to collect it from you — such as through wage garnishments or bank levies.
That is why the IRS actually assessing a tax is such a big deal because once a tax is assessed against you, the IRS has pretty awesome authority to collect it from you.
But assessment — the actual recording of your debt in the government’s books — must happen first.
Table of Contents
IRS Notice CP3219A At a Glance
| Letter Type: | 90-Day Letter |
| Generated By: | IRS AUR Program |
| Preceded By: | Notice CP2000 |
| Followed By: | Assessment |
| Recommended Action: | Submit Response With Documentation to AUR |
IRS Notice CP3219A Explained, Page by Page
The IRS has redesigned Notice CP3219A, and the images below come from a redacted version of an actual CP3219A that one of our clients received in January 2025: a nine-page notice proposing $103,290 in additional tax plus $46,480 in penalties for the 2022 tax year.
Here’s what each page of the redesigned CP3219A looks like and what it’s actually telling you.
Page 1: “Notice of Deficiency – proposed change to your tax”
The redesigned notice opens with a plain-English headline, “Notice of Deficiency – proposed change to your tax,” and the very first sentence tells you what you’re holding: the notice “serves as a Notice of Deficiency, outlining the proposed changes to your 2022 income tax and informing you of your right to challenge these changes.”
Directly beneath that is a boxed sentence containing the single most important date on the entire document: “You can contest the changes by filing a petition in the U.S. Tax Court. The last date to file a petition with the Tax Court is April 28, 2025.”
Our client’s notice is dated January 27, 2025, so that boxed date is exactly 90 days out (the 90th day landed on a Sunday, so the deadline rolled to the next business day). This is one real improvement in the redesign: the older CP3219A made you hunt for your petition deadline, and the new one puts it in a box near the top of page 1.
Next comes the Summary of proposed changes, which is where the notice tells you what the IRS thinks you owe:
- Proposed tax you owe (deficiency): $103,290
- Failure-to-file penalty: $25,822
- Substantial tax understatement penalty: $20,658
That’s $149,770 before interest, which this notice doesn’t quantify at all.
Note that the deficiency line carries an asterisk pointing you to the “What caused the differences” section, which in the redesigned notice is all the way at the back, on page 9.
Below the summary is a Next steps list: return the enclosed Form 5564 if you agree, scan the QR code or go to IRS.gov/DUTReply and enter the access code printed on your notice to respond online, visit IRS.gov/CP3219A or call 800-829-8310 with questions, write to the address at the top of the page, or, if you disagree, submit a statement explaining why by that same April 28 date.
That QR code is new. The older version of this notice pointed you to a fax number and described the Documentation Upload Tool in a separate section further back; the redesign moves the online-response option onto page 1.
Finally, every page of the redesigned notice now carries a footer showing the notice number, the notice date, the tax year, and the page number out of the total, which makes it easy to confirm you actually received the whole thing.
Page 2: Your right to petition the Tax Court, and “Changes to your 2022 tax return”
Page 2 opens with “You have the Right to Petition the U.S. Tax Court” and spells out the mechanics: you can contest the tax, penalties, and interest before paying anything, but you have to file within 90 days of the date of the notice (150 days if you’re outside the United States), and filing late means the Tax Court cannot consider your case.
The redesigned notice also tells you how to file. There’s a fillable petition form at ustaxcourt.gov, the Tax Court recommends electronic filing through a DAWSON account, and if you’d rather mail it, the address is United States Tax Court, 400 Second Street NW, Washington, DC 20217. The notice reminds you to include a copy of the notice and the filing fee, and it puts one warning in bold: don’t send your petition to the IRS.
The bottom two-thirds of page 2 is “Changes to your 2022 tax return,” which is the redesigned notice’s summary math, laid out as three stacked tables.
The first compares your income and deductions as filed against what third parties reported. On our client’s notice:
- Nonemployee compensation: $0 shown on the return vs. $5,479 reported to the IRS
- Partnership/trust/small business: $0 shown vs. $253,829 reported
- Taxable wages: $24,664 shown vs. $28,037 reported
- Income net difference: $262,681
The IRS then gives back the increase in the deductible portion of self-employment tax, $12,010, producing a change to taxable income of $250,671.
The second table walks that through the return line by line, comparing what was “Shown on return” against the figures “As corrected by IRS”:
- Taxable income (Form 1040, line 15): $186,088 to $436,759
- Tax (Form 1040, line 16): $32,332 to $100,372
- Child tax credit and credit for other dependents (line 19): $6,000 down to $2,850
- Self-employment tax (Schedule 2, line 4): $0 to $24,019
- Net investment income tax (Schedule 2, line 12): $0 to $8,081
- Total tax (Form 1040, line 24): $49,486 to $152,776
The difference on that last line, $103,290, is the deficiency printed on page 1. Two footnotes explain the direction of the arithmetic: increases to deductions decrease taxable income, and decreases to credits increase tax.
Notice how much of the damage here isn’t the income tax itself. The unreported self-employment income brought $24,019 of self-employment tax with it, the higher income triggered $8,081 of net investment income tax, and it knocked $3,150 off the client’s child tax credit. Underreported income rarely costs you just your marginal rate.
A third, much shorter table covers payments. In this case it’s income tax withheld of $171, which the IRS agrees with, so there’s no change.
The Additional information section then begins at the bottom of the page, starting with “Form W-2 or 1099 not received,” which makes the point that you’re required to report your income even when the payer never sent you the form.
Page 3: The rest of the “Additional information,” and your penalties
The “Additional information” paragraphs are conditional. You only get the ones the IRS thinks apply to your situation, so your CP3219A may not contain the same set. Our client’s notice includes four:
- Child Tax Credit or Credit for Other Dependents. The allowable credit depends on filing status, the number of qualifying persons, modified adjusted gross income, and tax, so when the IRS increases your income, the credit gets recomputed. That’s why our client’s credit fell from $6,000 to $2,850.
- Net Investment Income Tax. The 3.8% NIIT applies once modified adjusted gross income exceeds $200,000 (single or head of household), $250,000 (married filing jointly or qualifying surviving spouse), or $125,000 (married filing separately).
- Amendments or adjustments to your return. Any previous changes to your original return, including an amended return, are already reflected in the “Changes to your tax return” figures.
- Power of Attorney. The IRS confirms it sent a copy of the notice to the representative listed on your power of attorney. That is exactly why the copy pictured here is addressed in care of our firm.
Then comes the Penalties section, which on this notice contains two separate penalties.
The first is the failure-to-file penalty under Internal Revenue Code § 6651, here $25,822. The notice explains the rule: 5% of the tax owed for each month or part of a month the return is late, for up to five months, reduced by any failure-to-pay penalty for the same month, with a minimum penalty of $450 or 100% of the tax required to be shown on the return, whichever is less, once a return is more than 60 days late.
It’s worth doing that arithmetic on your own notice. On our client’s, $25,822 is 25% of the $103,290 deficiency, which is the statutory maximum, and that tells you the 2022 return was filed more than five months after its due date.
The second is the accuracy-related penalty for substantial understatement of tax under IRC § 6662(b)(2) and § 6662(d), here $20,658, or exactly 20% of the deficiency. The notice states the threshold that triggers it: an understatement of more than the greater of 10% of your correct tax liability or $5,000.
Page 4: Getting the penalty removed, interest, and where to get help
Page 4 picks up mid-sentence on the accuracy-related penalty and tells you how to fight it. The IRS says it may reduce or eliminate the penalty if you send a signed statement with either (1) the facts supporting your treatment of the understated income and the authority for your position, such as the Internal Revenue Code, Treasury Regulations, revenue rulings, or revenue procedures, or (2) an explanation showing you clearly disclosed the item, such as by attaching Form 8275 or Form 8275-R.
The Interest charges section cites IRC § 6601 and explains that interest generally runs from the due date of the return, regardless of extensions, until the balance is paid in full, and that the rates are variable and can change quarterly. Unlike the penalties, the redesigned CP3219A doesn’t put a dollar figure on interest anywhere.
Under IRS help, the notice lists IRS.gov/help, IRS.gov/CP3219A, the 800-829-8310 help line, and Publication 5181, Tax Return Reviews by Mail. There’s also a line here that a lot of people skim past: the IRS sends information about these changes to state and local tax agencies. If the federal change sticks, expect your state to come looking too.
The page closes with Taxpayer Rights and Sources for Assistance, covering the Taxpayer Bill of Rights and IRC § 7803(a)(3), Publication 1, the Taxpayer Advocate Service at 877-777-4778, and Low Income Taxpayer Clinics. Read one sentence in that section twice: contacting the Taxpayer Advocate Service doesn’t extend your time to file a petition.
Page 5: The “if you agree” and “if you disagree” boxes
The redesigned notice ends its narrative section with two boxes side by side.
If you agree with the proposed changes, you complete and sign the Form 5564 bound into the notice, and both spouses have to sign if you filed a joint return. You can pay now at IRS.gov/payments or wait for the billing notice, and the box warns that interest and penalties keep accruing until the balance is paid in full.
If you disagree with the proposed changes, the IRS asks you to contact it immediately, submit your explanation and supporting documentation at IRS.gov/DUTReply using the access code on your notice, or call the help line. And then it says the thing that traps more people than anything else on this notice:
“Our consideration of any additional information will not extend the April 28, 2025 deadline to file a petition with the U.S. Tax Court.”
Read that twice, because it is the whole ballgame. Sending the IRS a response, even a complete, well-documented, obviously correct response, does not stop the 90-day clock. If the IRS is still reviewing your documents when day 91 arrives, your right to petition the Tax Court is simply gone and the deficiency gets assessed.
The box also repeats that you have the right to petition the Tax Court to challenge both the deficiency and the penalties.
(Pages 6 and 8 of our client’s copy are blank. They’re the back sides of the printed sheets.)
Page 7: Form 5564, Notice of Deficiency – Waiver
Form 5564 itself is unchanged by the redesign, still the November 2016 revision, and it now sits on page 7 of the notice. It restates the numbers in their barest form: kind of tax, individual income; tax year ended December 31, 2022; increase in tax $103,290; failure-to-file penalty under § 6651(a)(1), $25,822; accuracy-related penalty under § 6662(a), $20,658.
The consent language above the signature lines is short, and it is worth reading slowly:
“I consent to the immediate assessment and collection of the deficiencies (increase in tax and penalties) shown above, plus any interest. Also, I waive the requirement under section 6532 (a) (1) of the Internal Revenue Code that a notice of claim disallowance be sent to me by certified mail for any overpayment shown on the attached report.”
In plain English: signing this form ends the 90-day standoff early and lets the IRS assess the tax right now. Your right to take that year to the Tax Court goes with it. The form’s own notes are candid about what survives that signature. You can still pay the tax, file a claim for refund, and sue in District Court or the Court of Federal Claims if the claim is disallowed, and the IRS can still determine that you owe additional tax later. But the Tax Court door closes.
Both spouses have to sign if the return was joint, and a representative signing on your behalf needs a power of attorney on file.
None of that makes signing wrong. If the IRS is right and you have nothing to add, signing stops the interest clock from running any longer than it has to on a liability you were always going to owe. It just isn’t a form to sign because it happens to be the only page in the envelope with a signature line.
Page 9: “What caused the differences”
Here’s the biggest structural change in the redesign. The itemized backup that used to sit in the middle of the notice, under a heading like “Explanation of changes to your tax return,” is now titled “What caused the differences” and appears at the very end of the document, after the waiver you’re being asked to sign.
Don’t sign anything before you’ve read this page, because this page is the evidence. Everything else in the notice is arithmetic performed on what’s listed here.
The table is grouped by income type with subtotals, and each row has six columns: Received from, Address, Account Information (which shows the document type and the Social Security number it was filed under), Shown on your return, Reported by third parties, and Difference.
On our client’s notice, page 9 shows:
- Taxable wages: one Form W-2 reporting $3,373 that didn’t make it onto the return
- Nonemployee compensation: two Forms 1099-NEC, for $271 and $5,208, totaling $5,479
- Partnership/trust/small business: two partnership Schedule K-1 documents, which the notice labels “Form PTK-1,” reporting $115,500 and $138,329, totaling $253,829
Underneath the table, the IRS tells you what to do if income listed there isn’t yours: contact the payer to get their records corrected, and give the IRS the name and taxpayer identification number of the person who actually received it, if you know it.
The page finishes with “Self-Employment Tax on Self-Employment (SE) income,” which explains where that $24,019 of self-employment tax came from, walking through the 12.4% Social Security component, the 2.9% Medicare component, and the additional 0.9% Medicare tax above the threshold for your filing status. It also notes that the IRS will credit your Social Security account with the self-employment income shown on the notice.
This is the page to work from when you check the IRS’s math, because every dollar of the proposed deficiency traces back to a specific document from a specific payer listed right here.
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Call 866-8000-TAXWhen the IRS Sends Notice CP3219A
The most common reason for the IRS sending you a Notice CP3219A is when the following things happened:
- You filed a tax return for the tax year mentioned on the notice and the IRS believes that you did not report all your income based on information it received from third parties on information returns such as Form 1099, Form W-2, Schedule K-1, and more.
- The IRS Automated Underreporter (AUR) Program sent you a Notice CP2000 that you did not respond to (or that you did send a response to but AUR failed to process).
What You Should Do If You Receive a Notice CP3219A
Below are the steps you should take after you receive a Notice CP3219A.
1. Make sure you actually earned the income that the IRS is claiming you did not report.
Go through the “What caused the differences” section, which on the redesigned notice is the last page, and review, line by line, every item of income listed there and ask yourself, “Did I actually earn this income?”
For example, if you see that the IRS has record of receiving a Form 1099-NEC issued to your Social Security number for $5,208 from a company you never worked for, or from a company you did work for but that paid you less than $5,208 during the year, you need to take that up with both the issuer of that 1099 and also with the IRS.
So starting here, you’re going to be making a list of things that:
- you need to take up with the IRS in the letter you’re going to write them in response to the Notice CP3219A and
- you need to take up with other parties, primarily entities that issued you erroneous tax documents.
Obviously if you didn’t actually earn the income reported on the 1099-NEC or at least not all the income that was reported on the 1099-NEC, then the tax form the IRS is looking at and based on which it is proposing to assess an additional liability against you is erroneous and the IRS is overcalculating your tax liability.
And no one’s going to fix it other than you (or your representative).
So this is the first step — review the income the IRS is saying you didn’t report, compare it to your own records, and if there are discrepancies, keep a running list of things you need to do to fix this.
2. For income you did earn but didn’t report on your return, check for deductions.
So let’s say you were an Uber driver and you made $50,000 gross during the year driving for Uber but you forgot to include your Uber income on your tax return.
So nine to 15 months after you file your return, the IRS sends you a Notice CP3219A indicating that Uber issued you a 1099 showing $50,000 and the IRS is proposing an assessment of taxes, penalties, and interest on you assuming that you should have reported an additional $50,000 of income on your tax return.
And in this instance, the IRS is correct that you didn’t report that $50,000 of Uber income as gross receipts on your Schedule C. However, you have business deductions you can take against that $50,000; so you shouldn’t be taxed on the full $50,000 — which is what the IRS is proposing in the Notice CP3219A — you should only be taxed on your net business income from your Uber driving.
And obviously from that $50,000 gross, you can deduct things like Uber’s cut as well as the vehicle expenses you incurred while earning income driving for Uber using either the standard mileage method or the actual expenses method (not going to get into that here).
And those expenses might be $30,000 — I’m just making up a figure, by the way — so your net business income would only be $20,000.
So even though the IRS is right you didn’t report that $50,000 as gross receipts on Schedule C like you should’ve, the IRS doesn’t know your expenses, and they’re not going to estimate expenses for you; it’s on you to inform the IRS about these expenses.
If you would have reported the $50,000 of gross Uber income on your Schedule C, you would have reported these expenses to the IRS on all the expense lines on Schedule C, but because you didn’t, you’ll have to inform the IRS of them in your response to the Notice CP3219A.
On this point, may even want to prepare a dummy Schedule C to attach to your response saying, “Hey, IRS, this is what my Schedule C should have looked like had I filed it correctly.”
3. Calculate how much taxes you actually owe.
So now that you’ve gone through the previous steps, I would actually recommend that you prepare a tax return showing what your tax liability should actually be if you include all the income you didn’t report correctly on your actual tax return, including deductions.
If you still have access to your tax software, you can try to do it that way or if you’ve hired a professionals like us at Choice Tax Relief to respond to the Notice CP3219A on your behalf, we will do that for you.
Because at the end of the day, you want to know what you actually owe; don’t trust the IRS to calculate your liability for you.
Now, if you really want to get fancy, you would probably want to calculate the penalties and interest as well to check the IRS’s math on that — and that’s something we would do for you at Choice Tax Relief — but that may be a bit complicated if you don’t have the tools to do that.
4. Determine if you’re still subject to the substantial understatement penalty.
That said, there is one penalty that you should probably do the math on, and that’s the accuracy-related penalty for substantial understatement of tax.
The IRS assesses this penalty if you understate your tax liability on your tax return and this understatement is more than the larger of these two figures:
- 10% of your correct tax liability
- $5,000
So let’s go back to the Uber example.
IRS says that you didn’t report $50,000 of self-employment income, and it calculated what it believes your tax to be on $50,000 of self-employment income in the proposed assessment.
The actual math is more complicated than this, but assuming your marginal regular income tax rate on all this income is 24%, the IRS would say you owe an additional $12,000 in regular income tax on this income.
And you’d also be subject to self-employment tax at a rate of 15.3% on this income assuming that you haven’t maxed out your Social Security income limit through other income you earned.
(And yes, tax nerds, I know there’s a a 92.35% multiplier in here as well, but let’s just keep things simple for the sake of example.)
So that means that the IRS would also propose an assessment of $7,650 of self-employment tax on this $50,000 as well, but let’s round up to $8,000 just for sake of example.
So combining the $12,000 in regular income tax and $8,000 of self-employment tax, then in the IRS’s mind, the amount of your understatement of tax liability on your tax return is $20,000.
Now what you have to do is add this figure to the amount of tax liability you actually reported on your return — let’s say that was $10,000.
So your “correct” tax liability in the IRS’s mind is $30,000.
So in the IRS’s mind because your $20,000 understatement exceeds $5,000 (which is the greater of $5,000 or 10% of your correct tax liability of $30,000, so the greater of $5,000 or $3,000), it believes that you are subject to the substantial understatement penalty.
And the penalty itself is 20% of the understatement, so in this case 20% of $20,000, which is $4,000.
And check whether your notice carries a second penalty on top of that one. Our client’s redesigned CP3219A also proposed a $25,822 failure-to-file penalty under IRC § 6651 alongside the $20,658 accuracy-related penalty, because the 2022 return was filed late. That penalty has nothing to do with how you reported the income; it is about when you filed.
5. Send your response to the IRS, along with supporting documentation.
At this point, you have an idea of what your game plan is and what you think the additional assessment of tax should be.
So now, you have to explain all this to the IRS because they’re not going to change their mind if you don’t change their mind; they’ve proposed an assessment and have communicated it to you on the Notice CP3219A; now you have to step up to the plate and convince them otherwise.
You do this by writing a letter to the IRS and sending it in with your supporting documentation. The redesigned CP3219A asks you to respond online at IRS.gov/DUTReply using the access code printed on your notice, or by mail to the address at the top of page 1.
Whichever way you send it, send it early enough that you are not counting on the IRS to finish reading it before your 90 days run out. As the notice itself says, responding does not extend your Tax Court deadline.
What if you agree with the IRS?
If you agree with the IRS’s proposed assessment in the Notice CP3219A — meaning that 1) you agree that you did not report the income the IRS listed in the “What caused the differences” section of the Notice CP3219A, 2) you have no deductions or other tax benefits to claim about this income, and 3) you agree with the IRS’s calculation of the tax on this income along with penalties and interest, you can sign the Form 5564 enclosed with your notice and send it back to the IRS.
Just be clear on what that signature does. It consents to immediate assessment of the tax and penalties, and it gives up your right to petition the Tax Court for that tax year. It is worth having a tax professional read the notice before you sign anything.
What If You Still Owe the IRS?
Of course, if you still owe the IRS a balance due after responding to your Notice CP3219A, and even after the IRS AUR Program accepts your changes, you’ll need to figure out how you’re going to resolve this balance.
Now, you could simply pay whatever balance is owed in full along with penalties and interest.
But it’s generally at least worth seeing if you’ll qualify for any penalty abatement and if you really can’t pay what you owe at the moment see if you could qualify for some kind of tax relief option, such as an offer in compromise, some kind of installment agreement, being placed in currently not collectible status, or several others.
To learn more about these options, read this article about how to get IRS tax debt relief or watch the video below.
Should You File a Tax Court Petition?
Before I conclude this article, I do want to answer the question, “Should I file a Tax Court petition in response to receiving a Notice CP3219A?”
Now, most cases with AUR issues — even after the Notice CP3219A has been issued — can be resolved simply by submitting a response to the IRS Automated Underreporter (AUR) Program.
That said, there may be — depending on your particular case — a reason to file a Tax Court petition before that hard 90-day deadline mentioned in the notice.
For example, if you would still have a large tax balance due with penalties and interest even if IRS AUR accepts your response without issue, filing a Tax Court petition may increase your odds of penalty abatement.
This is because when you petition the Tax Court, you don’t go straight to Tax Court; they kick your case to Appeals first.
And Appeals tends to be a bit more generous with penalty abatement than the IRS collections department.
And speaking of Appeals, another thing to keep in mind here — and this is probably getting a little too deep down the procedural rabbit hole here — but if you don’t file a Tax Court petition to contest the deficiency, you won’t be able to dispute the tax liability before IRS Appeals in the future because you had a previous opportunity for Appeals consideration, i.e., via filing the Tax Court petition.
This may come into play if you’re taking a very aggressive position to dispute the IRS’s proposed assessment or some position that the IRS could potentially challenge on the basis of tax law.
Also, another thing to keep in mind is that filing a Tax Court petition will typically buy you some more time before the IRS comes to collect.
However, you should not file a Tax Court petitions simply as a means of delaying collection.
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Author:
Logan Allec, CPA, Founder and Owner
Logan Allec has been serving taxpayers as a CPA for over 14 years. After leaving his role at a "Big 4" firm, he started Choice Tax Relief to help everyday Americans who have found themselves behind on their taxes. He also educates thousands of people daily about tax relief on his YouTube channel. In addition to his CPA license, Logan also has a Master's Degree in Taxation from the University of Southern California (USC). He lives with his wife and children in the Los Angeles area. Learn more about Logan here.
