IRS collection letters rarely arrive one at a time. If a balance goes unpaid, the IRS typically sends a series of notices, and each one carries more weight than the last. Knowing where you are in that sequence tells you how much time you may have and which options are still open.
Here is a plain-English guide to the most common IRS collection notices for individuals, in the order people usually see them. The notices, in order.
CP14: the first bill. A CP14 tells you the IRS believes you owe tax that hasn’t been paid. It lists the balance, including penalties and interest, and a due date. If you pay in full by that date, the IRS says you won’t owe more interest; after that, interest keeps accruing. If you disagree with the amount, the notice tells you how to contact the IRS. If you can’t pay, this is often the easiest time to set up a payment plan.
CP501: the first reminder. A CP501 means the IRS hasn’t received payment or a response to the earlier bill. The IRS warns that it can file a Notice of Federal Tax Lien, a public claim against your property that can affect your ability to borrow. At this stage, you can still pay, request a payment plan, or ask for an appeal under the Collection Appeals Program (CAP) before collection action takes place.
CP503: the second reminder. The IRS describes the CP503 as “your second reminder.” The balance is still open, penalties and interest are still growing, and a lien may be filed if one hasn’t been already. Payment plans and CAP remain available.
CP504: Notice of Intent to Levy. The CP504 is the turning point. The IRS calls it your final reminder, and it's a Notice of Intent to Levy under Internal Revenue Code section 6331(d). After a CP504, the IRS can levy your state tax refund. It also warns that it can levy wages and bank accounts and seize property. For seriously delinquent tax debt, the IRS can also certify the debt to the State Department, which can lead to passport denial or revocation. [The IRS asks you to pay “immediately,” so treat this notice as urgent.
LT11, Letter 1058 and CP90: the final notice. These letters (LT11 / Letter 1058, CP90) are the IRS’s Final Notice of Intent to Levy and Notice of Your Right to a Hearing. The IRS generally must send this final notice at least 30 days before it levies wages, bank accounts, or other property. It also opens an important deadline, explained below.
LT16: collection and missing returns. An LT16 means the IRS is trying to collect unpaid taxes, find missing returns, or both. It warns of possible enforcement, including liens and seizures. If you have unfiled returns, filing them is usually the first step toward any resolution.
Your hearing rights and appeals
When you receive an LT11, Letter 1058 or CP90, you can request a Collection Due Process (CDP) hearing with the IRS Independent Office of Appeals, generally using Form 12153. For proposed levies, the request is due within 30 days of the letter date. A timely CDP request generally pauses levy action while the hearing is pending, and you can raise alternatives such as a payment plan or Offer in Compromise. If you miss the 30 days, you can request an Equivalent Hearing within one year of the notice, but you can’t take Appeals’ decision to Tax Court, and you may still be at risk for collection activity.
CAP and CDP are two different appeals. The Collection Appeals Program is available earlier in the process and for liens, levies, and seizures; it’s generally faster, but you can’t go to Tax Court if you disagree. Collection Due Process is triggered by specific notices, such as the final notice of intent to levy or a notice of lien filing; it has a strict deadline and, if requested on time, can lead to Tax Court review. Which one fits depends on the notice you received and the issue you want to raise.
What to do when a notice arrives
- Don’t ignore it. Penalties and interest grow, and options narrow as the notices progress.
- Find the notice number and date. It’s usually in the top or bottom right corner.
- Check that it’s real. The IRS usually first contacts people by mail. You can confirm your balance in your IRS online account.
- Confirm the amount. If the balance looks wrong, contact the IRS using the number on the notice.
- Mark your deadlines, especially the 30-day window on an LT11, Letter 1058 or CP90.
- Make sure all returns are filed. Most resolution options require current filing compliance.
- Choose a path. Options can include full payment, a payment plan, Currently Not Collectible status or an Offer in Compromise, depending on your finances.
Frequently asked questions
How long do I have after a CP504? The CP504 doesn’t give a set number of days; the IRS asks you to pay immediately. The IRS can levy a state refund after a CP504, and the final notice with hearing rights (LT11, Letter 1058, or CP90) generally comes before other levies.
Is a CP504 the same as a final notice? No. The CP504 is the IRS’s final reminder, but the LT11, Letter 1058, or CP90 is the notice that starts the 30-day Collection Due Process window.
Can the IRS take my paycheck? Yes, after the required notices, the IRS can levy wages. A payment plan, Currently Not Collectible status or other resolution can stop or prevent a levy in many cases.
How long can the IRS collect? Generally up to 10 years from the date the tax was assessed. Some actions, such as a CDP hearing, pause that clock.
Will a payment plan stop the notices? Once a plan is in place and you keep it current, the IRS generally won’t levy. Interest and penalties keep accruing until the balance is paid.
Each notice in the sequence narrows your options and shortens your timeline. If you’ve received any of these letters, Bryson Law Firm, LLC can review where you are in the process and explain the options that may be available to you. Contact our office today to schedule a free, initial consultation.
