The IRS has the responsibility of seeing to it that taxpayers pay their taxes punctually. When a taxpayer defaults on their taxes or does not pay in full, they will begin to receive IRS notices regarding their defaulted obligation.
What are IRS Notices?
Understanding that the IRS has the right to reach you and demand that you pay your taxes is important. However, more important is understanding the notices the IRS sends, what they mean, how they should be approached, and how to tackle them.
The IRS sends out various forms of notices which can be easily resolved using the right knowledge. Finding the notice specific to your case may not be something you have the time or patience to go into. That is why we have provided you with a comprehensive list of the common IRS notices that you are likely to receive.
CP 504
Simply put, this is a notice indicating that the IRS is about to levy your tax refund or your assets. Your assets include both personal and properties and business assets.
This notice is sent when you have an unpaid account. When you get this notice, confirm it to be sure it is actually unpaid. If you disagree with the claim, you have the option of contacting the IRS to tender your complaint.
You will be instructed on what to do next.
CP 2000
The CP 2000 is a notice that alerts you of disparities between your tax return and the income information the IRS has. If you get this notice, you should immediately verify the situation and check your other returns to be sure similar mistakes do not exist.
The IRS has payment plans you can choose from if you actually owe.
However, CP 2000 notices are not a hundred percent accurate because they are computer-generated. So you may not actually owe anything. The best approach to this notice is to evaluate the situation and respond to the IRS via mail, proving your position.
CP 501/ CP 501
The CP 501 and CP 502 are the first and second notices respectively that the IRS sends to remind you that you have defaulted on one of your taxes.
The CP 502 comes after the CP 501 and could be a little more intense.
Generally, these notices give you a detailed explanation of the tax you owe such as the amount you owe, the due date, the year the debt was created, and so on. Failure to respond to this notice and pay up your tax can lead to several penalties such as seizing your assets, garnishing your paychecks, and putting a lien on your future tax returns.
CP71C
This notice is a reminder of a tax debt that you probably may have forgotten. The IRS may give you a few years to pay up. Failure to do that results in this kind of notice.
The CP71C also tells you why your passport is being revoked or why you are not eligible for the United States passport.
CP 14
This notice simply informs you of the money you owe on unpaid taxes. The amount you owe and the penalties and interests accrued due to the unpaid tax.
CP 11
A CP 11 notice usually comes to notify you that there has been a miscalculation in your tax return. This miscalculation usually means that you now owe the IRS as a result of the new calculation.
If you disagree with this notice, you can contact the IRS to complain. However, if it turns out to be true, you should pay up before the due date. The IRS has payment options available for you.
CP 90/CP 297
Both of these notices are sent to inform you of the intention of the IRS to seize your assets due to your unpaid taxes. The difference between 90 and 297 is that the former is for individuals while the later is for businesses.
With this notice comes your right to a hearing. You also reserve the right to appeal to the lien.
CP 161
This notice comes when you have an unpaid balance due. If you get this notice, go through the details carefully, pay attention to the details it contains. Next, compare your tax return with the figures on the notice and check if all the payments you made were applied to your account. If you have a dispute, contact the IRS within 10 days.
CP 23
This notice comes because there was a change in your tax return due to a difference spotted between the number of estimated tax payments on your tax return and the amount paid into your account.
If you agree with the changes made, pay up or ask for suitable payment options.
If you disagree, you should contact the IRS before the 60-day window elapses.
CP 523
You get this notice when you default on your installment payments. Your failure to stick with the payment plan has led to the plan being terminated. This is a relatively serious notice and you should contact the IRS immediately.
CP 16
This notice comes to inform you that your tax refund has been affected due to some changes made to your returns. You do not have to take any action on this if you agree. If you do not, however, you should contact the IRS within 60 days with sufficient proof.
CP 10
This notice comes as a result of miscalculations. A CP 10 notice will affect your tax returns for this fiscal year and the next.
CP 22E
This notice comes to inform you that you owe money due to a recent tax Audit.
CP 49
If you get this notice, it means that you should not expect any tax refund from the IRS anymore as it has been used to settle an outstanding debt.
As with other notices, you can contact the IRS if you have an objection.
CP 59
This means that the name on your ID and returns do not match the one on your account. The IRS wants to know who is filing your taxes.
CP 11A
If you filed a tax return and claimed the Earned Income Tax Credit, the IRS has discovered some errors which have cost you another outstanding balance.
CP 521
This notice is to alert you of an upcoming installment payment due, according to the IRS payment plan you are on.
You are expected to mail in your payment as a response.
Letter 1058
This notice means that the IRS is about to seize your property because they have not received your payment on an overdue tax. This is a notice you should respond to immediately if you disagree and one you should pay immediately if you agree.
Letter 3172
Getting this notice means that you have unpaid taxes and the IRS has filed a tax lien or a claim to seize your assets.
Letter 668D
Finally, we have the Letter 668D. Getting a letter 668D from the IRS that should make you happy. This notice comes to inform you that the IRS no longer wishes to seize your assets and have released the tax lien that was leveled against you.
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