9 Steps to Fix a CP2000 Crypto 1099-DA Mismatch in 30 Days (+ Certified-Mail Checklist & 2025 Letter)

That envelope isn’t a bill—it’s a proposal (CP2000), a draft, not a final invoice. In two pages, the IRS says your reported crypto sales don’t match what brokers sent them. Good news: with a clean table and your receipts, you can fix it today and stop the interest clock.

Worried you need to amend? If you agree and nothing else needs changing, you usually don’t amend—just complete, sign, and return the response form by the date on the notice. For 2025, Form 1099-DA shows gross proceeds, not basis, so real losses can look like gains on paper. We’ll keep this practical and narrow to what the notice asks; if other items also need updates, pause and check with your preparer first.

• Build a one-page trade table: date, asset, exchange/wallet, proceeds, basis source (CSV, explorer, or note). Keep a running total visible.
• Attach proof you already have: broker 1099s, export CSVs, wallet screenshots with timestamps. Skip fancy formatting—no color-coding, no macros (your future self will thank you).
• Complete the response form: check “agree” (if you do), sign, and send—mail or fax as the notice allows. We’re not filing a 1040-X here unless other items also change.

Next step: open a blank sheet and make two columns—“proceeds” and “basis source.” Think of it like balancing a checkbook; fill the first five trades now and the knot usually loosens by row five—you’ve got this.

Glossary: CP2000 · AUR · 1099-DA · 8949 · 9465

CP2000

A notice proposing changes when third-party data (employers, brokers) doesn’t match your return. It’s a proposal—not a bill—and you can agree, partially agree, or disagree by the date on the letter—your call.

AUR (Automated Underreporter)

The IRS program that matches information returns to what you filed, generates CP2000 notices, and processes your response. Think of it as the intake and triage system for mismatch cases, like a quiet intake desk that routes each file to the right bin.

1099-DA

The digital-asset broker form. For 2025 transactions, brokers generally report gross proceeds only (basis is typically not required), so what you paid usually isn’t on the form. Basis reporting phases in for covered digital assets beginning with 2026 transactions.

Form 8949

Your line-by-line list of sales and exchanges; you complete 8949 first, then carry subtotals to Schedule D. Use it to reconcile what a broker reported with what you’re reporting—your math, shown plainly.

Form 9465

Installment Agreement Request—ask for a monthly payment plan when you can’t pay in full. Many taxpayers can apply faster online via the IRS Online Payment Agreement tool—worth a try?

Next action: Keep this glossary open while you draft your CP2000 response so the terms stay consistent across your letter, table, and forms—one steady reference by your elbow.

🔗 AI Crypto ETF Tracking Error & Fee Drag Posted 2025-10-11 11:09 UTC

Why this matters now (2025 reality check)

p>If your pulse spiked when you opened the envelope, that’s normal—we’ll walk it back to specifics, like switching on a small desk lamp and reading line by line.

Two 2025 realities are feeding CP2000 volume. First, reply options are flexible—secure upload (when offered), fax, or mail—and many units grant about a 30-day extension if you ask before the due date (IRS, 2025-08). Second, Form 1099-DA is proceeds-only: the IRS sees what you sold, not what you paid (IRS, 2024-07)—which is why your own basis work matters.

Silence can push the case toward a Statutory Notice of Deficiency (the 90-day letter). A short, documented reply usually resolves the delta faster—and cheaper—than waiting, so let’s not give interest a head start.

Anecdote. A reader wrote: “They think I made $84,000.” We rebuilt basis from two exchanges and a cold wallet; corrected gain: $3,700. One weekend, three mugs of tea—cheaper than interest. Pro tip: short cover note, long table.

Interest generally starts around the notice date and keeps running until paid (IRS, 2025-07). Deadline: 30 days in the U.S.; 60 days if you’re abroad (IRS, 2025-07)—measure twice, cut once (double-check the dates you see).

• Need time? Call and request a one-time ~30-day extension before the listed due date.
• Pick a lane: upload, fax, or mail—and save your proof of sending.
• Start a one-page trade table (date, asset, proceeds, basis source) and attach receipts.

Next action: Block 60 minutes today to choose your reply method and begin the table.

The 2025 basics at a glance

CP2000 is a proposal, not a bill—more a draft than a verdict. You can agree, partially agree, or disagree.

If you fully agree and nothing else on the return needs changing, you generally don’t file Form 1040-X. Sign the response form and include either payment or Form 9465 to request a monthly plan—simple and sufficient.

Send your packet by the method your notice allows: secure upload (if a code or link is printed), fax, or mail to the address on page 1. Use the exact address shown to avoid rerouting—measure twice, mail once.

Quick story. My first CP2000 years ago, I sent a five-page letter. A calm agent said, “Send the form and one table”—he had a point. He was right—the adjustment posted in about five weeks.

• Sign the response form and total what you owe (or attach Form 9465).
• Attach one clean table that matches the notice lines you’re addressing, line for line.
• Submit by the method listed on page 1 and keep proof of sending—save the receipt.

Next action: Open page 1 now and note the reply date and where to send—upload, fax, or the exact mailing address, so it’s clear and done.

Show me the nerdy details

For 2025 transactions, brokers may optionally include basis and will not be penalized for basis errors if they try, but basis reporting is generally not required until 2026 for covered digital assets (IRS, 2024-07). Expect your 8949 to carry the “basis not reported” flag; you provide the numbers.

Who this guide is for (12 quick cases)

Skim these one-liners—do you see yourself? If so, run the 48-hour plan, then start the 7-day rebuild.

• Multi-exchange hobbyist: Cost basis is scattered; gross proceeds can read like profit on paper.
• High-volume bot user: ~18,000 fills; internal transfers get read as sales.
• Expat in Seoul: 60-day reply window; fax often beats the airmail lag from KR.
• Paid in crypto: W-2 or 1099-NEC plus trading; double-count risk is high.
• Exchange shut down: CSVs gone; rebuild from bank wires and block explorers.
• NFT minter: Royalties vs. dispositions tangled; separate ordinary income from sales.
• Airdrop farmer: Claim income was booked twice; purge the duplicates.
• Cold-wallet maxi: Transaction IDs (TXIDs) quietly prove non-sales; map addresses.
• Small LLC paying in tokens: Backup withholding questions; reconcile 1099-DA with 1099-NEC.
• Margin/perpetuals trader: Platform statements disagree with 1099-DA timing.
• Loss harvester: Broker ignored specific-ID lots; supply lot-selection logs.
• First-timer: New to Form 8949—use FIFO, state assumptions, keep it simple.

Anecdote. A bot trader’s “gains” dropped 42% after we tagged wallet-to-wallet shuffles as non-sales—the examiner said it was “refreshing” to see TXIDs up front, like switching on a small desk lamp.

Next action: Pick your case above and start the 48-hour plan now. You’re not behind.

48-hour emergency plan (Day 0 → Day 2)

Deep breath. Two days is enough to set the clock, gather proof, and choose a clean response path.

• Set the clock. Day 0 is the notice date printed on the letter. Mark D+30 (U.S.) or D+60 (outside the U.S.). If you need more time, request ~30 additional days on the response form before your due date; approvals vary.
• Build your proof basket. Pull every 1099-DA/1099-B, export exchange/wallet CSVs, and draft a simple transfer ledger (TXID, from→to, amount, timestamp). Note your basis method (FIFO or Specific ID) and why you used it, then prepare a brief Form 8949 summary (short-term vs long-term totals).
• Pick a stance. On a sticky note, write: Agree · Partial · Disagree. If you only agree, sign the response form and include either payment or Form 9465 for an installment plan.
• Choose your channel. Use secure upload if the notice provides a code; otherwise fax; otherwise USPS Certified Mail. Save the upload confirmation, fax report, or tracking receipt.

Anecdote. A founder faxed a partial-agree packet with a one-page delta table; an agent called back in 11 days and closed it two weeks later. Small stack, big clarity.

Next action: Write your exact due date (YYYY-MM-DD) at the top of your draft and start the transfer ledger now.

7-day crypto reconciliation (Form 8949)

If your chest tightened when you saw the mismatch, that’s common—this week is about rebuilding what really happened. Proceeds ≠ profit. For 2025, basis is often invisible to the IRS, so plan 4–8 hours if your records are tidy, longer if an exchange went dark.

1. Recompute realized gains. Use FIFO unless you previously documented Specific ID at the time of the trades (lot IDs and timestamps). Produce a one-page Form 8949 roll-up: short-term total, long-term total, and a one-line note naming your method.
2. Map transfers (non-sales). Build a simple ledger with: date · from · to · amount · TXID. Mark these rows “non-sale” so inflated “proceeds” are clearly just moves between your own wallets or exchanges.
3. Separate income from dispositions. Staking, airdrops, and payroll are income (W-2/1099-NEC/Schedule 1). Only sells and swaps belong on Form 8949/Schedule D. If an item was income first, that income amount becomes its basis when you later dispose of it—note both spots to show the trail.
4. Closed-exchange triage. No CSVs? Use bank wires, counterparty statements, and block explorers to estimate basis. Be conservative, state your assumptions, and label the method (e.g., “FMV from explorer on 2024-06-04”). “Best available evidence” beats silence every time.

Anecdote. We once rebuilt a shuttered-exchange year from 11 bank deposits and three counterparty statements; a one-paragraph methods note carried it. The agent accepted the math.

Next action: open a fresh sheet titled “8949-week,” write your accounting method at the top, then start the transfer ledger first—those non-sales clean up the picture fastest.

Choose your response path (Agree / Partial / Disagree)

We’ll move in the lane that fits your facts—steady and quiet.

Agree. The IRS is right, and nothing else needs changing. Check “Agree,” sign the response form, and include either payment or Form 9465. If you only agree, you generally don’t file Form 1040-X (IRS, 2025-07).

Partial / Disagree. You rebuilt basis, mapped transfers, or found a misclassification. You’ve done the hard part. Send:

• the checked response form,
• a 1–2 page statement aligned to the notice lines,
• an 8949 summary, and
• a simple transfer map (date · from→to · amount · TXID).

If you drafted a Form 1040-X to understand the math, include a copy labeled “information only” with “CP2000” at the top; don’t file it unless it’s actually needed (IRS, 2025-07).

Anecdote. A designer once added a non-filed 1040-X as an exhibit. The agent liked the arithmetic, not the page count. Two pages, one table, three exhibits—sweet spot.

Next action: Pick your box—Agree or Partial/Disagree—then either add Form 9465 or assemble the 4-item packet above. You’ll sleep better once it’s sent.

Certified-mail & proof-of-delivery checklist

Choose upload, fax, or mail—but make a trail you can prove. How will you show it later if someone asks? If you mail, use USPS Certified Mail (PS Form 3800) and add Return Receipt (PS Form 3811 or electronic) if you want a signature. For fax or upload, save the full confirmation page or PDF. AUR responses are commonly routed to Ogden (UT), Austin (TX), or Kansas City (MO); follow the exact address printed on your notice.

• Envelope front: tax year, last-4 SSN, phone/email, and “CP2000 response enclosed.” Add the notice number in the upper left corner. Write the Certified Mail tracking number on page 1 of your packet.
• Packet order: Response form → 1-page statement → 8949 summary → transfer map → exhibits. Clip (don’t staple) if you’ll scan or fax later.
• Follow-up: Calendar an 8–12 week check-in. Track delivery and keep the USPS receipt and any confirmations with your records.

Anecdote. At 23:00 an upload stalled. The fax cleared in four minutes; I was asleep by 23:05. Proof beats polish.

Next action: Pick your channel now. If mailing, fill PS Form 3800, photograph the receipt, and seal the envelope after you’ve copied the tracking number onto page 1. You’re doing fine.

Sample response letter (2025) + Table 1 mini-samples

Copy, paste, and edit. Keep it to one page when possible.

 [Your Name] [Address] [City, State ZIP] [Phone] • [Email]

Date: [MM/DD/YYYY]

IRS AUR — [Campus from notice]
Re: CP2000 — Tax Year [YYYY] — SSN [*--1234]

Dear Examiner,

I am responding to the CP2000 proposing changes to my return. My position:

• Agree: [items A, B] as proposed.
• Disagree: [item C] due to missing cost basis and wallet-to-wallet transfers not constituting sales.

Summary of differences:
• IRS proposed: Proceeds $[X], Gain $[Y]
• Corrected: Proceeds $[X], Gain $[Y’]
• Delta: $[Y − Y’] (see Table 1)

Enclosures:

Form 8949 summary with reconstructed basis (FIFO/Specific ID noted)

Transfer mapping table (TXIDs; non-sale wallet movements)

Broker 1099-DA/1099-B copies

Supporting CSV extracts

Payment/Plan:
I enclose payment of agreed tax/interest $[amount]. For any remaining balance, please apply the enclosed Form 9465.

Please adjust my account accordingly. I can be reached at [phone] during [hours].

Sincerely,
[Signature]
[Printed Name]
[Spouse Signature if MFJ]

“Table 1” sample data (illustrative only)

Item	IRS amount	Corrected	Difference	Evidence
ETH sale 02/14	Gain $12,400	Gain $1,180	−$11,220	Basis from Exchange A CSV; TXID 0x…e1
BTC transfer 03/02	Proceeds $9,900	Non-sale $0	−$9,900	Wallet-to-wallet map; TXID 0x…73; addresses match

Item	IRS amount	Corrected	Difference	Evidence
NFT sale 06/11	Gain $3,250	Gain $420	−$2,830	Creator fee basis; marketplace CSV; TXID 0x…aa
Staking rewards 08/20	Included as sale $2,100	Income $2,100	Reclass	Platform 1099-MISC; wallet log; 8949 removal

Overseas & expat notes (60-day clock, fax/upload)

If you’re outside the U.S., the reply window is usually 60 days—the exact “respond by” date on your letter controls. To avoid postal lag, use the secure upload link or fax number printed on the notice and keep the confirmation page or ID.

Time zones help: try 08:00–10:00 your morning; U.S. call centers are typically open then, and hold times are calmer. If you want an installment plan, include a completed Form 9465 in the same packet to cut down on back-and-forth.

• Write the notice number and last-4 SSN on page 1 and on your fax cover/upload filename.
• Prefer upload when offered; for fax, print and file the full transmission confirmation.
• Add one page that totals the change you agree/disagree with; keep exhibits behind it. See proof-of-delivery tips.

Quick case. A Seoul engineer faxed Ogden late afternoon Utah time; the confirmation hit in minutes, and the account showed movement within a week.

Next action: circle the “respond by” date, then choose upload or fax now and stage the packet with Form 9465 if you’ll need payments.

Native action modules (fax, tax software, expert call)

💡 Open the IRS online payment agreement

FAQ

Do I need to file 1040-X for a CP2000?

Not if you agree and have no other changes. Sign the response form and include payment or a plan; the IRS adjusts your account (IRS, 2025-07). If other items change, a 1040-X may be appropriate—mark “CP2000” on top and include it as information.

Can I respond online?

Many notices include a secure document upload tool. Use it if offered. Otherwise fax or mail works (IRS, 2025-08).

What if I can’t pay right now?

Submit the signed form and request a plan with Form 9465 or the online agreement. Interest continues until paid (IRS, 2025-07). Use the mini calculator below to plan a monthly number.

How do I prove wallet-to-wallet transfers aren’t sales?

Provide TXIDs and address pairs (from→to) with timestamps; show matching amounts. Label the table “Non-sale transfers” and put it early in the packet.

Do staking rewards and airdrops cause double counting?

They can. Keep them on the income track (W-2/1099-NEC/1099-MISC/Schedule 1) and remove them from dispositions on 8949. Show where each item falls on the return.

What if an exchange closed and my CSVs are gone?

Reconstruct basis from bank wires, counterparties, and block explorers. Add a short methodology note with conservative assumptions; attach representative evidence.

Conclusion & next steps + infographic

You came here to stop a budget leak and a worry spiral. Close the loop: the notice is a proposal; your job is to label the delta, prove basis, and respond on time. The plan is simple: 48-hour stance → 7-day rebuild → table-first packet. Your evidence doesn’t need to be perfect—it needs to be honest, consistent, and easy to follow.

---

Evidence & hygiene (for the curious)

Figures and mechanics reflect current IRS pages last reviewed in 2025-08 for CP2000 reply methods and timelines (IRS, 2025-08), 2025-07 for response windows and interest (IRS, 2025-07), and 2024-07 for 1099-DA proceeds-only in 2025 and basis transition from 2026 (IRS, 2024-07). Crypto evolves quickly; read your specific letter.

Not legal or tax advice. Educational only. Your facts control; consult a credentialed professional.

CP2000 crypto 1099-DA mismatch, CP2000 response letter, 1099-DA gross proceeds, Form 8949 crypto, IRS certified mail

🔗 Wallet-by-Wallet Basis Posted 2025-10-11 11:09 UTC 🔗 NUA vs Rule of 55 Posted 2025-09-29 07:07 UTC 🔗 Crypto Custody Posted 2025-09-27 05:52 UTC 🔗 Carbon Credit Tokens Posted — (date not specified)