The Situation: In late 2024, our client David (name changed) received a CP3219A proposing $38,000 in additional tax plus $7,600 in penalties and $4,200 in interest — a total of $49,800. The deficiency stemmed from a CP2000 notice that David had received six months earlier but failed to respond to. The IRS claimed David had unreported 1099-B income from stock sales totaling $142,000.
The Problem: David had sold the stocks, but the IRS assumed his cost basis was $0 — meaning they treated the entire $142,000 in sale proceeds as profit. In reality, David had purchased the shares for $118,000, making his actual gain only $24,000. David came to us on Day 85 of the 90-day period.
What We Did:
- Day 85: Performed emergency case evaluation — confirmed the IRS’s error on cost basis
- Day 86: Prepared and filed a Tax Court petition via the DAWSON electronic filing system, preserving David’s rights with 4 days to spare
- Week 3: Received notice from IRS Office of Appeals requesting a conference
- Week 8: Presented brokerage statements showing the correct cost basis to IRS Appeals
- Week 12: Reached settlement agreement with IRS Appeals
The Result: The original proposed deficiency of $38,000 in tax was reduced to $7,200 (tax on the actual $24,000 gain). Penalties were fully abated due to reasonable cause (David’s broker had failed to report cost basis to the IRS). Total savings: $42,600.
Timeline: CP3219A received → Global Gate engaged (Day 85) → Tax Court petition filed (Day 86) → Appeals conference (Week 8) → Settlement reached (Week 12) → Case closed.
Received a CP3219A? Time is running out. Every day that passes is a day closer to losing your Tax Court rights. Call Global Gate Tax Relief NOW at 1-877-800-8180 — we handle emergency Tax Court petitions and can protect your rights even on short notice.