A part of the IRS duty is to remind taxpayers if they have any outstanding taxes. They send letters and notices to remind you of the said unpaid taxes. An example of these is the IRS CP504 Letter or the Notice of Intent to Levy.
What is a CP504 Letter
In this letter, it states that failure to make a payment within 30 days from the date of the notice, the IRS can put a levy to your property or rights to property. Anyone who receives this letter and reads this would typically be alarmed. So what should you do when you receive a CP504? And does the IRS immediately levy your property when you don’t make the payment within 30 days of the statement? More of this will be discussed in this article.
What to do when you receive a CP504
- First, do not panic. Read the notice carefully to get a clear understanding of what you owe and all the other details related to that. In the notice you should find the due date, billing details, payment options, and contact information in case you need to call them.
- Check if what the amount they are demanding is correct. The IRS is not perfect. They can also make mistakes which is why reading your statement carefully is important. If you disagree with the amount due, you can call the IRS to have a representative review your account. The number to call is provided in the notice as well.
- If possible, make the payment before the said due date.
- If you are having difficulties of paying the amount due, you may discuss a payment plan with the IRS. You can make the payment in installments. There are also other tax relief options that you can check out. You can call us for an evaluation on an Offer In Compromise or Penalty Abatement.
When to make a payment
Make your payment before the mentioned due date. In the notice, it says that if the IRS hasn’t received any payment within 30 days from the day of the notice, they may levy your property. So if you cannot afford how much they are billing you, better to call them and see what payment plans are available for you.
What happens if you don’t pay the amount due
Although the headline of the CP504 notice says “Notice of Intent to seize (levy) your property or rights to property”, the truth is, they won’t be going for your property right away. The first thing they will be levying are your tax refunds.
After the IRS has levied your tax refunds and you still have remaining debt, sending a Final Notice of Intent to Levy or LT11. You are also given the right to a hearing with the IRS Office of Appeals. After then will the IRS have the right to levy your property or rights to property. The list of properties include the following:
- Bank accounts
- Wages and other forms of income
- Business Assets
- Personal Assets
- Social Security Benefits and pensions
Call them if you don’t agree
You have the right to request an appeal if you don’t agree with the intent to levy before the collection action happens. This is under the Collection Appeals Program (CAP).
On the other hand, if you also made the payment, also make a call to make sure that they reflect this on your account.
You still have time to get legal advice
If you receive a CP504 letter, you still have time to get legal advice and plan what is the best action to take for your case. Instead of approaching the IRS prematurely, go to our Contact Page to get help with the best solution to propose to the IRS.