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Notice code 124 (Default) — We didn’t allow the IRA loss claimed on page 1 of your Form 1040. The loss is subject to a 2% limita…
What this IRS notice code means, and what to check before you reply.
What to do next
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124
Read the notice carefully and note any deadline. Gather returns, notices, and payment records. Book a free strategy session before responding if the amount is large, unclear, or collection language appears.
What the IRS language says
We didn’t allow the IRA loss claimed on page 1 of your Form 1040. The loss is subject to a 2% limitation and should be claimed as other expenses on Schedule A, Itemized Deduction. If you have other itemized deductions in addition to the IRA loss, you should file a Form 1040X (Amended U.S. Individual Income Tax Return).
What it usually means
124 is in our IR Manual catalog. Official wording is dense — we translate it for business owners and individuals and map realistic next steps.
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