CP3219A: the statutory notice of deficiency from the Automated Underreporter program

What the notice means

IRM 4.19.3.2.1.1 defines it: “A CP 3219A, Statutory Notice of Deficiency (SNOD), also called a Statutory Notice of Deficiency (Stat), SNOD or “90-Day Letter” , is the legal notice in which the Commissioner determines the taxpayer’s tax deficiency.” Under IRC 6212 and 6213, the IRS cannot assess most additional income tax without first issuing this notice unless the taxpayer agrees. The notice contains a letter, a waiver (Form 5564), the computation and an explanation of the adjustments.

The IRS page says the notice “isn’t a bill or audit.” It is the formal determination that opens the door to the Tax Court without paying first, which is why it is often called the ticket to Tax Court. It also warns that the amounts on Form 5564 “may not match your prior notice amount due. This is because you can’t challenge all items in U.S. Tax Court.”

Why the client got it

The CP3219A is the last step of the AUR sequence: CP2501 (sometimes), then CP2000 proposing changes from third-party information, then the CP3219A if the CP2000 was not answered or the response did not resolve the discrepancy. The AUR glossary describes the CP2000 the same way: if the taxpayer “fails to respond or if the response is insufficient, the IRS sends a CP 3219A.”

Two common reasons a represented taxpayer still gets one: the CP2000 response arrived late or was not associated with the case, or the response was a payment without the signed consent. On the second point, IRM 4.19.3.22.1 is explicit: “Full payment received after issuance of a Statutory Notice can’t be accepted as agreement to the tax increase.”

The clock and what happens if it passes

IRM 4.19.3.2.1.1: “Once the IRS issues this notice, the taxpayer has 90 days (150 days if the Stat is addressed to a person outside the United States) from the date the CP 3219A is mailed to file a petition in the U.S. Tax court. This 90-day (or 150 day) period is statutory and IRS employees can’t extend it.” IRC 6213(a) adds a useful protection: “Any petition filed with the Tax Court on or before the last date specified for filing such petition by the Secretary in the notice of deficiency shall be treated as timely filed.” Calendar the date printed on the notice and the computed 90th day, and use the earlier if they differ.

If no petition is filed, the IRM says the IRS “is permitted to assess the deficiency, after the 90 days (or 150 days) have passed,” and warns that “the taxpayer loses significant administrative and judicial avenues to dispute the IRS’ decision if they don’t file a petition.” After assessment the remaining routes are audit reconsideration, paying and filing a refund claim, or a doubt as to liability offer.

How to respond

There are two tracks, and a representative can run them at the same time.

1. Authorization and transcript. File a Form 2848 for the year, then pull the account and wage and income transcripts to see what the IRS matched.
2. Track 1: resolve it with AUR. The IRS page says: “We’ll work with you to resolve your issue during the 90-day response period.” Send the corrected information return, a payer statement, or the explanation and documents, by the upload tool, fax or mail listed on the notice. IRM 4.19.2.4.6.6 says “All CP 3219A responses are considered HIGH PRIORITY work, as the taxpayer has limited time to file a petition with U.S. Tax Court.” If AUR agrees, it can issue a recomputed notice while time remains to petition.
3. Track 2: protect the Tax Court right. If the issue is not fully resolved in writing well before the deadline, file the petition. The IRS page is direct: “We’ll work with you to resolve your issues during the 90-day period, but this won’t extend the time you have to file a petition in Tax Court.” See petitioning the Tax Court and the small tax case procedure. A petitioned case is usually sent to Appeals to try to settle.
4. If the client agrees, sign and return Form 5564. For a joint return both spouses must sign the same notice. IRM 4.19.2.4.6.6.1 cautions: “If the taxpayers sign their individual CP 3219A, consider the response to be disagreed.” A check alone is not agreement.
5. If the client needs time to pay, agreement can come with a payment plan request. Interest runs until paid.

A response to AUR that does not clearly agree is worked as a disagreed response. The IRM says that if the “I don’t agree with some or all of the changes” box is checked, employees treat the response as disagreed even with a signature.

What the IRS does next

If AUR accepts the response before the period ends, it adjusts or closes the case (for a full concession, no assessment). If the client signs Form 5564, the IRS assesses the agreed amount and a balance due notice follows. If a petition is filed, the IRS cannot assess until the Tax Court decision is final, and the case generally goes to Appeals first. If nothing happens, AUR defaults the case and assesses; the assessment then moves into the collection notice stream (CP14 and the notices after it).

Related notices

The campus examination version of this notice is Letter 3219, and field examinations use Letter 531. The full Tax Court mechanics are on the notice of deficiency page.

Questions practitioners ask