Assessment is the statutorily required recording of the tax liability. Assessment is made by recording the taxpayer’s name, address, and tax liability.
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When you file your tax return, the IRS calculates the amount of taxes due (if you owe) and assesses (or records) the tax liability to your tax account. The IRS can also assess additional tax, penalties and interest as a result of an error on your tax return, through an audit, or through a CP2000 notice. After an audit or when a CP2000 notice is sent, the IRS proposes an increase in tax and you have the opportunity to dispute the increase in taxes. If you do not dispute the increase or your appeal is denied, the IRS will issue a Statutory Notice of Deficiency. 90 days after the Statutory Notice of Deficiency is issued, if you do not file a petition in U.S. Tax Court, the IRS will assess the tax (record it on your tax account) and send you a tax bill.
Learn how to handle an IRS audit. Or, learn about an IRS audit of your business.
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Related tax terms
Statutory Notice of Deficiency
Related IRS notices
IRS Letter 1085 - Proposed Assessment
IRS Notice CP3219A - Notice of Deficiency & Increase in Tax
IRS Letter 2566 - Proposed Individual Tax Assessment
IRS Letter 2205 - Your Federal Income Tax Return Has Been Selected for Examination