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Five Common IRS Notices for Tax Debt Collection

February 26, 2013

The IRS begins sending notices to taxpayers as they pursue collection of a back tax bill. Preliminary IRS notices regarding tax debt are used to urge taxpayers to act. Without quick communication with the IRS by taxpayers, the IRS will move to aggressive collection actions to receive payment.

CP-14 Notice: Informing taxpayers about their tax debt
A CP-14 is the first notice a taxpayer receives from the IRS about their tax debt. This notice includes the amount of debt owed, the due date of their payment and their various payment options. If taxpayers can pay back the entire amount owed in full, they will only be charged an initial penalty and no interest. After the due date, interest will be added monthly.

CP-501 Notice: Threat of tax lien if tax debt is not paid
A CP-501 notice is a reminder about a taxpayer’s tax debt along with a warning that if the tax debt is not paid, the IRS may place a tax lien on the property of the taxpayer. After receiving this notice, taxpayers should immediately make arrangements with the IRS.

CP-49 Notice: Tax Refund used to fulfill a tax debt
A CP-49 is a notice notifying a taxpayer that the IRS will use all or part of their refund amount to fulfill a tax debt. Depending on the amount of the refund or the tax debt, it may satisfy the debt, or reduce the total amount substantially.

CP-503 Notice: Warning of seizure of property and/or assets
A CP-503 notice gives taxpayers 10 days to resolve their tax debt. After this notice the IRS may file a Notice of Federal Tax Lien and also look at other assets for seizure to secure payment of the tax debt.

CP-297C Notice: Right to appeal against tax levy
A CP-297C notice notifies taxpayers that the IRS has placed a levy on their bank accounts or assets. This notice informs taxpayers about their right to appeal the levy, if they decide to. They may use Form 12153, Request for a Collection Due Process or Equivalent Hearing to communicate with the IRS and resolve their tax debt.

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