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IRS Notice CP 504 – What Does This Letter Contain and What I can Do.
The final notice of balance due in back taxes to the IRS is listed in the CP 504 letter. In this notice, you will be informed that the IRS has chosen to issue a levy against your tax refund from the state. It will also list other details regarding the IRS initiating a search for other possible assets they are able to lay a levy on. Lastly, it will mention that a process might begin to file a federal tax lien against you if you choose to not repay.
What is the next step after the IRS sends a CP 504 letter?
If you have ignored the previous CP notices, you are then required to reimburse the balance of the back taxes owed immediately. The IRS recommends immediate payment to avoid a lien or a levy against any of your current assets.
I have received my CP 504 notice, when should I contact the IRS?
You must contact the IRS immediately once you receive this letter. This letter outlines the seriousness of the IRS to take further action against you to collect the money you owe. It is highly advocated that once you receive this letter, you speak with an IRS representative and without delay set up an agreement to make installment payments.
If I decide not to answer the CP 504 notice and not pay my back taxes, now what happens?
It is not recommended to ignore this notice; however, if you decide to, the IRS will proceed with a lien and levy process. It will further complicate your current situation, as the IRS will now be taking the money you owe from wherever they can, including your assets.
I need to discuss the CP 504 letter with someone, who can I talk to?
If you have any questions about this notice you received, call up the IRS number that is provided to you on the notice. They will be available to determine how you can repay taxes. If you are unable to pay them back, the IRS representative will assist in creating a plan for payment or a different version of a tax settlement.
I got the CP 504 notice, but I do not think the IRS was right in sending it to me?
If you are not in agreement with the CP 504 notice, it is imperative to contact the IRS right after you get the letter. Explain why you believe receiving this letter was an error. However, since the CP 504 notice is the last CP notice, it would be more beneficial to discuss your current back taxes situation prior to receiving this letter.
These are some of the most common ways to extend the statute, but there are also other methods the IRS can employ. To learn more, it is advisable to speak directly with a tax specialist. They are especially helpful in situations where you believe you have exceeded the statute but the IRS is attempting to take action.