IRS Notices and Letters

January 8, 2024

Don’t Let IRS Letters and Notices from Harass You

Receiving IRS Notices regarding your back tax debt?  Seek immediate help from a qualified tax debt relief company. Valley Tax Law (ITS) has the professional experience you need. Our team of tax experts help you navigate the complex paper work of the IRS, saving you time, money, expediting to resolution.

Common Types of Notices

IRS Notices and letters come in a variety of forms. They address very tax problem that exist, and may post a threat to your financial security. The purpose is to warn to taxpayers who have an outstanding liability before actually initiating aggressive collection action. You may receive one regarding:

The tax professionals at Vally Tax Law have the knowledge and experience to deal with all IRS Notices. We are experienced in working with the IRS in thousands of cases and navigating their processes.

Notice CP 11: Changes to Tax Return, Balance Due

When there are changes made to a tax return or in the event a balance is due the IRS will send a taxpayer the CP 11 notice . It will clearly show the taxpayer the changes that are being made to 1040 Individual Income Tax Form. The changes that were made to your tax return resulted in a balance being due. The purpose of this form is to explain how and why the changes were made.

Anytime the IRS makes any type of change to a tax form, a notice showing indicating “Math Error” is sent to the taxpayer. There is also an account statement enclosed which explains in detail how your taxes were affected by said changes. There is a three-digit code that is also assigned to each description.

The stub portion on the last page of the notice lists the Math Error codes: “aaabbbccc”. The first code being denoted by “aaa”, second one by “bbb”, and third code is listed as “ccc”. If there are more than three changes described on the notice, then only the first three will print on the stub. Now that you have a basic understanding of how codes work, you can look them up on the IRS website.

Other items explained on the notice are as follows:

  • Why the notice is being sent
  • Why the changes are being made
  • What to do in the event you agree with said changes
  • What to do if you do not agree with said changes

Some of the other paperwork and information that may be sent with a CP11 IRS Tax Notice:

  • A Form 2210:Underpayment of Estimated Tax by Individuals, Estates and Trusts
  • A Form 9465: Installment Agreement Request Form
  • Notice 1212:Automated Telephone Service
  • Notice 746: Information About Your Notice, Penalty and Interest
  • Publication 1: Your Rights As A Taxpayer

All of this information must be filled out accurately therefore, it is advisable that you contact a qualified company like us to handle this situation. We have dealt with these types of notices before and can guide you in the right direction.

CP 14: Changes to Tax Return, Balance Due

The reason a taxpayer would receive a CP14 IRS tax notice is not because of a mathematical error. This form shows you the amount the IRS has determined a taxpayer has underpaid. The middle of the form explains the amount you reported in taxes, the IRS tax credits applied and the amount of underpayment in question.

Check for Reporting Accuracy

The first thing that should be done is checking the form for reporting accuracy. Often times a misapplied payment is the result of there being a balance due. If the amount of tax you paid differs from the ones the IRS shows, they will need information from you to research the discrepancy. Once the payment is discovered it will be applied and the penalties, fines and interest will be removed from your account.

If your records are in line with IRS records, then you are responsible for paying the amount due on its due date. If you can’t pay the amount, expect IRS to begin the process of penalties and interest to your account. Common alternatives are requesting an IRS installment agreement, which will allow you to pay the debt back in smaller payments over a longer duration.

Underpayments occur for a variety of reasons. If you received this notice because of a missing payment in question, have your registered agent contact the IRS and provide them with payment verification. Ensure the representative aware of the amount of the missing payment, and give them some time to research their records. If the missing payment information can’t  be found in a timely manner, they may need the encoding information from the back of your check. (if you used checks to pay the account) They will make a note of the relevant information and cease further collection activity until the situation is resolved. In many cases, it is best to furnish them with a clear photocopy of the check or money order you used to pay this account with.

Other Reasons You May Have Received This

You may have received a notice because the amount on your payment does not match the amount shown on the notice. In this circumstance again, it is best to have your tax lawyer contact the IRS and furnish them with a copy of the canceled check or a copy of any information or documentation, that can be used to back up proof of payment.

If you received a notice because of an amended return showing a decrease of tax debt, then your tax professional will again need to contact the IRS for confirmation that this return was processed after the notice was issued.

If your notice shows a difference between the total tax amount than the tax that was reported, again this is a situation that requires a professional’s contact with the IRS. The government has pre-printed address labels that identify a code. This code shows the tax period for the particular return in question. If you used a previous photocopy of the return in question, it may have been the result of a clerical error on the part of the government’s systems.

If you receive any notices after paying off your tax debt in full, simply having your tax attorney call the IRS should work out this problem. Most times an issue with a CP14 notice can be resolved with minimal headache. The easiest way to resolve any problems is to have your representative call the revenue officer and verify information and your account should be taken care of.

CP 23 Notice: Changes Made to Estimated Total Tax

When a taxpayer receives a CP 23 Notice in the mail, it references when the amount of Estimated Tax Payments being reported on a tax return differs from IRS records. This notice may also show the taxpayer that the government has made certain changes to their account to reflect this problem. Because there is a difference or discrepancy in the amounts, the causes there to be a balance due on the taxpayers account.

There are two pages included with this notice that will contain the following information on Page 1:

  • Income
  • Adjusted Gross Income on the return
  • Taxable Income
  • Payments & Credits
  • Withheld Tax
  • Estimated Tax payments
  • Credits
  • Payments
  • Total of payments & credits
  • Tax
  • Total amount of tax on return
  • Underpaid taxes plus:
  • Penalty
  • Interest
  • Amount owed
  • Subtract payments not included
  • You would then owe the adjusted amount

If you contest the adjustments then you will need to have your representative contact the government to dispute the amount. Provide them with a copy of the tax return in question, along with any paperwork or receipts that prove the debt has been paid. This information is vital if the IRS is going to prove that any payment made, that was not applied to your account.

CP 501 Notice: Reminder of Balance Due

The CP 501 letter is sent to remind a taxpayer that there is a balance due on their tax account. This is a one page, secondary notice that is sent after previous notices have been ignored. If the outstanding tax is not paid within 10 days, the IRS can take adverse collection actions against you. This notice is sent on an account that has had penalties and interest assessed, there is a two-digit code to identify the explanation.

The last page of this notice contains alpha codes such as “aa”, “bb”, “cc”, “dd”, “ee”, “ff”, “gg”, or “hh”. The “aa” is identified as the first code, the “bb” is the second and so on and so on. Only codes for the first eight explanations are printed on this stub.

There are also enclosures and forms sent with this notice:

Notice 1219B:Notice of Potential Third Party Contact-this means that the IRS can speak to others in regards to your tax debt
Notice 1219B (SP):Avis De Possible Communication con Teresa(s) Persona(s)-Insert for Spanish speaking taxpayers
Notice 609:Privacy Act Notice
Notice 746:Information about Your Notice, Penalties and Interest
Publication 594:What You Should Know About The Collection Process

If you get this notice in the mail, it is to to tell you that the IRS has determined you owe money. If you have previously paid the notice, then you need to call the IRS to confirm payment was received. However, if you are unable to pay the notice in full or have questions, please refer to your tax attorney for further assistance.

CP 503 Notice (Second Notice)

The CP 503 (Second Notice) is a one page notice that is sent to inform you that you still have an outstanding balance on your account. The form is sent because the IRS has not received contact from any of the other notices that were previously sent.

This form will contain the word, IMPORTANT! It requests that immediate action be taken in regards to your outstanding tax balance. It will also explain how if you do not pay heed to this notice, you are facing penalties and interest that will only compound and get worse. You are legally required to pay the entire balance due within 10 days from the receipt of the notice.

If you had previously made this payment, do not simply disregard this notice. You still need to contact the IRS and verify whether or not they have received the payment in question. The information contained on this form will include your account summary which shows: outstanding balance, tax period date, form number, penalty, interest and date last payment was received. If you have any questions about this form, please contact your tax lawyer for resolution.

CP 504: Final Notice, Balance Due

CP 504 notice is sent with a sense of urgency to taxpayers who owe money to the IRS. This form is sent when no payments have been made and this is the final notice that is sent before a levy will be obtained. This notice is one page in its entirety, and will explain your account information in detail.

Form 504 is a one page notice and contains the following information:

  • A two-digit code that explains the assessments
  • A tear off stub on the last page of notice with a code of “aa”, “bb”, “cc”, “dd”, “ee”, “ff”, etc.
  • There will be no more than eight codes assigned to this stub

This form is telling you as a taxpayer, that the government intends to file a levy against any anticipated tax refund, to collect a past due balance. The IRS will also begin to investigate your other assets as well. They may also file a Federal Tax Lien as a result of the past due amount owed. You can either pay the amount shown on the notice or enter into an installment agreement.

We can make arrangements and contact the government on your behalf to work out the best solution for you and to stop any collection actions that may be going on.

CP 521: Installment Agreement Reminder Notice

This CP 521 notice is one page in total and is sent to remind the taxpayer that a payment is due on their installment agreement (as detailed here). The penalties and interest will accrue and are calculated to the due date of the notice. The interest will continue to build until the balance is paid in full.

A two-digit code is assigned to the notice in the format of “aa”, “bb”, “cc”, “dd”, “ee”, “ff”, etc. and each code represents a penalty. There will be a maximum of eight codes only shown on the account. Once you have figured out which codes are on your notice, you can begin to understand what they stand for.

CP 523: Notice of Intent to Levy, You Defaulted on Your Installment Agreement

A CP 523 Notice is forwarded to the taxpayer to show that they have defaulted on previously arranged installment agreement. This means that the person did not abide by the terms of their installment agreement and they are now in default status. A CP 523 form shows the reason for default, intent to levy assets or income and the rights the taxpayer has to prevent collection action from being taken.

The standard stub issued contains alpha characters to represent the various tax codes. They are shown in the format of “aa”, “bb”, “cc”, “dd”, “ee”, ff, “gg”, and so on. The first code is represented as an “aa”, and the preceding codes are listed in order. No more than eight codes will be listed on one stub.

The IRS also encloses the following forms in this notice:

  • Notice 1219B: Notice of Potential Third Party Contact-the IRS intends to speak to others about your tax debt
  • Notice 1219B (SP): Avis De Possible Communication con Teresa (s) Persona (s)-For Spanish speaking taxpayers
  • Notice 609: Privacy Act Notice
  • Notice 746: Information About Your Notice, Penalty and Interest
  • Publication 594: What You Should Know About The Collection Process

They will only send this notice in three instances, you missed a payment, you have a new balance or you failed to file a tax return. You have 30 days from the date of the notice to respond. This is an official cancellation of your payment plan agreement.

CP 90: Final Notice of Intent to Levy & Notice of Your Right to a Hearing

CP 90 Notice is sent to a taxpayer to inform them of an intent to levy on your assets. If there is a balance due on your account, they have the right to pursue collection actions against you. If you had previously received a notice showing a balance due, and did not pay the balance, then the balance is still due. The CP 90 Notice is then forwarded and a taxpayer has a a 30 day window within which to respond.

The CP 90 notice is two pages in total and contains information about how to go about contact an agent to pay off the balance, make payment arrangements,and what information you should enclose when sending correspondence or payment. Page number two will be a stub showing your form number, tax period, assessed balance information, statutory additions, paying late penalty, interest and the total amount you owe.

The following information is also enclosed with the two pages of the CP 90 Notice:

  • Form 12153: Request for a Collection Due Process Hearing
  • Publication 594: What You Should Know About The IRS Collection Process
  • Publication 1660: Collection Appeal Rights

They can levy any type of income or payments you receive such a contractor/vendor, social security benefits, salary, employee travel per idem money, property or rights to property, real estate, automobiles, bank accounts and any thing else you own or have financial interest in.

This type of levy gives the IRS rights to anything they need to make you pay your debt. If you receive this notice or have questions, concerns, have previously paid the notice, or wish to contest the notice, you need to contact us for further assistance.

CP 91 IRS Notice: Final Notice Before Levy of Social Security Benefits

This is a notice that entails information about the government filing a final notice before take your social security benefits. It is sent to taxpayers who owe an outstanding balance on back taxes. This is not the first one sent, and if the taxpayer has ignored previous notices this is the final one prior to action being taken. The form notifies the taxpayer that the amount is still outstanding and that up to 15% of social security benefits will be seized to secure payment. The taxpayer has 30 days to respond once this notice is sent.

There are two pages included in this notice. The first page contains information about account, your rights and their contact information. It tells you what to do if you can pay the amount in full and what to do if you are unable to pay the balance off. It also advises you that if you want a tax attorney or professional to represent you in this matter that you will need to file a Form 2848: Power of Attorney and Declaration of Representative.

Page two of the notice is your account information. It includes your account or form number, tax period, assessed balance, statutory additions, paying penalty late, interest and the total amount of tax owed. This is how the IRS will list information for all outstanding accounts.

There is also the following forms and information enclosed in this notice:

  • Publication 4134: Low Income Taxpayer Clinics for low-income taxpayers
  • Copy of notice
  • Envelop

If you have previously paid this balance and have proof, then you should contact the IRS as soon as possible. If you have questions about the balance, or need to have an installment agreement requested, your tax attorney can assist you with this information also.