Collection notice
How do I respond to an IRS collection notice?
Mr. Powell answers IRS collection notices for individuals and closely held businesses, and he takes those matters nationwide from 1629 K Street NW, Suite 300 in Washington, DC. Read the paper notice first. Identify the letter code, the assessed balance, and any hearing or payment date printed on it. Do not ignore the letter. Do not use this page to calculate a deadline.
The official IRS instructions on that notice control. This page is not legal advice.
What to do first.
An IRS collection notice concerns an assessed balance, a lien, a levy, or a payment option. It is not an examination letter. The paper notice and the agency that issued it control which path applies.
If a tax debt cannot be paid in full, the IRS describes options that may include a payment plan, an offer in compromise, a temporary delay of collection, and penalty relief. Most payment plans and relief options require that required tax returns are filed.
For a Maryland resident, a Chapter 13 plan can also pay priority tax debt over time under court supervision; see Chapter 13 for IRS back taxes.
Official source: Get help with tax debt
Official source: Payment plans
Official source: Understanding a federal tax lien
Official source: What is a levy
The paper in hand
Start with the letter code and the date printed on it.
Read the paper notice
Identify the letter code, the tax years, the assessed balance, any lien or levy warning, hearing rights, and the response deadline printed on the letter.
Match the letter to the path
A balance-due series such as CP14, CP501, or CP504 may precede levy action. LT11 and Letter 1058 are final notices of intent to levy and notices of a right to a Collection Due Process hearing. Letter 3172 concerns a Notice of Federal Tax Lien. A collection notice is not an examination letter.
Protect any hearing date on the letter
If the notice offers a Collection Due Process hearing, calendar the date printed on the letter and follow the request instructions in that notice. The date and instructions on the notice control. Do not use this page to calculate that deadline.
Decide the next contact
Use IRS Letter Check for a supported notice code. If the firm can consider the matter, start with a high-level summary of what the collection notice says, the balance shown, and any hearing or payment date printed on it.
What not to do.
Do not ignore the letter. Do not treat a collection notice as an examination letter. Do not send documents or sensitive details in the first contact. Do not assume that sending a request alone stops collection. Read each collection notice and confirm the account's current status.
LT11 and Letter 1058 are final notices of intent to levy and notices of a right to a Collection Due Process hearing. The IRS says to request that hearing within 30 days from the date of the letter. The date and instructions on the notice control. Do not use this page to calculate that deadline.
Some collection actions also qualify for the Collection Appeals Program. IRS Publication 1660 explains the difference. Using one hearing path can limit what another hearing can consider.
Official source: Collection Due Process FAQs
Official source: Requesting an appeal
Official source: IRS Publication 1660
Official source: IRS Publication 594
Questions
Common questions.
How do I respond to an IRS collection notice?
Read the paper notice first. Identify the letter code, the assessed balance, the tax years, and any hearing or payment date printed on it. A balance-due series such as CP14 or CP501 asks for payment. A final notice of intent to levy, LT11 or Letter 1058, carries a 30-day right to request a Collection Due Process hearing under 26 U.S.C. section 6330, made on Form 12153. Letter 3172 reports a filed Notice of Federal Tax Lien and carries its own section 6320 hearing right. The official IRS instructions on the notice control.
What should I not do after an IRS collection notice?
Do not ignore the letter. Do not treat a collection notice as an examination letter. Do not send documents or sensitive details in the first contact. Do not assume that sending any request stops collection. A timely levy Collection Due Process request generally suspends the levy actions at issue, while a lien hearing request does not by itself stop a levy, and an audit reconsideration request stops nothing on its own. Read each collection notice and confirm the account's current status.
What does an IRS collections attorney in Washington, DC handle?
An IRS collections attorney represents individuals and closely held businesses facing an unpaid tax balance, a federal tax lien, a levy, or a payment option. Law Office of Alexander Powell, PLLC has an office at 1629 K Street NW, Suite 300 in Washington, DC and represents those clients in IRS collection matters nationwide. Each matter begins with the collection notice, the assessed balance, and any lien, levy, or hearing deadline shown on the letter.
What is a Collection Due Process hearing?
A Collection Due Process hearing is a review by the IRS Independent Office of Appeals of a lien filing or a proposed levy. LT11 and Letter 1058 are final notices of intent to levy and notices of that right, and 26 U.S.C. section 6330 gives 30 days from the date of the letter to request the hearing on Form 12153. A timely levy request generally suspends the levy actions at issue and preserves Tax Court review under section 6330(d)(1). A lien hearing request does not by itself stop a levy. The date and instructions on the notice control.
What payment options does the IRS describe for unpaid tax?
Where a tax debt cannot be paid in full, the IRS describes a payment plan, an offer in compromise, a temporary delay of collection, and penalty relief. An individual owing $50,000 or less in combined tax, penalties, and interest, with required returns filed, can set up a payment plan online. Most payment plans and relief options require that the required tax returns are filed. An installment agreement does not extend the collection period, and the Internal Revenue Manual states that the collection statute is not suspended while an agreement is in effect.
Do I have to hire a lawyer to respond to an IRS collection notice?
No. A taxpayer may deal with the IRS directly, and many collection notices are answered by paying the balance, filing a missing return, or requesting a payment plan online where the balance is $50,000 or less in combined tax, penalties, and interest with the required returns filed. A representative matters when the amount is contested, when a lien or levy is already in play, or when a 30-day Collection Due Process window is running, because that window closes whether or not anyone answers it.
Read the collection notice.
An IRS collections attorney represents individuals and closely held businesses facing an unpaid tax balance, a federal tax lien, a levy, or a payment option. Law Office of Alexander Powell, PLLC has an office at 1629 K Street NW, Suite 300 in Washington, DC and represents those clients in IRS collection matters nationwide. Each matter begins with the collection notice, the assessed balance, and any lien, levy, or hearing deadline shown on the letter.
Read IRS collections for payment options, liens, levies, and hearing rights. Read IRS levy and offer in compromise when those are the collection issues. If the balance still depends on an open examination, start with IRS audit defense. If the audit is closed, the assessment remains unpaid, and there is new information the IRS did not consider, read audit reconsideration.
Related pages
Related IRS collection notice resources.
- IRS collections attorneyRead how the firm approaches unpaid balances, liens, levies, and collection hearing rights.
- IRS levyRead how the firm approaches wage levies, bank levies, and notices of intent to levy.
- Offer in compromiseRead how the firm approaches an IRS offer to settle a tax debt for less than the full amount.
- IRS AppealsRead how the firm approaches review by the IRS Independent Office of Appeals, including collection hearing rights.
- Audit reconsiderationA closed audit with an unpaid assessment and new information is a different path from collection.
- CP14Balance-due notice.
- CP504Notice of intent to levy.
- LT11 or Letter 1058Final notice of intent to levy and Collection Due Process hearing rights.
- Letter 3172Notice of federal tax lien filing.
- IRS Letter CheckLook up the code printed on a supported IRS letter.
Send the letter code and the date printed on it.
Tell me what the collection notice says, the balance shown, and any hearing or payment date printed on it. Send only a high-level summary.
Schedule an initial consultationRequesting a consultation does not make Mr. Powell your lawyer, provide legal advice, or protect a deadline.
Law Office of Alexander Powell, PLLC. 1629 K Street NW, Suite 300, Washington, DC 20006.