CP240: your employment tax return was changed to match W-2s and 1099-Rs

What a CP240 means

A CP240 says the IRS changed your employment tax return because it found differences between the return and the income and withholding reported on your Forms W-2 and 1099-R and similar wage and withholding forms. [1]source 1

The usual cause is a mismatch between quarterly returns and year-end forms. We'd reconcile the year's Forms 941 against the W-3 totals before deciding whether the change is right.

Why people get one

• The totals on the employment tax return didn't match the W-2, 1099-R and similar forms for the year. [1]source 1

First steps

1. Read the notice for the period and the change. [1]source 1
2. Reconcile the employment tax returns with the W-2 and W-3 totals for the year.
3. If the change is right, pay by the date on the notice or look at other ways to pay. [1]source 1
4. If you disagree, contact the IRS at the number on the notice, within the time its page gives. [1]source 1

What not to do

• Don't pay without reconciling first; a mistake on the year-end forms can be the real problem.
• Don't pay through a link or phone number in an unexpected email or text. Use irs.gov, typed in yourself.

Keep reading

• Form W-2
• Withholding

Questions