IRS Collection Notices & Letters For New Jersey Tax Payers
The purpose of notice CP14 is to inform tax payers of an unpaid balance that is due. Notice CP14H is received when a taxpayer is billed for failing to have health insurance. Notice CP14I is received when a taxpayer is billed for IRA contributions in excess. If you receive a CP14 notice, your situation isn’t urgent, but you should take action to pay what you owe.
A CP15 notice means that the IRS has asserted a “frivolous return” penalty against you. The CP15 notice is extremely dangerous, because the IRS has labled your return as frivolous. It is possible to appeal the determination, but it’s unlikely the IRS will reverse their determination without compelling evidence. The CP15B notice is used to impose Employer Business taxes on an taxpayer as a responsible individual for the Trust Fund Recovery Penalty for failing to pay employment or excise taxes.
The CP39 notice is meant to inform an individual that a spouse or ex-spouse’s refund has been applied towards other taxes due. It’s important to investigate your case if you receive a CP39 notice. Often, the IRS believes you owe taxes, but in many cases, no tax is due.
A CP42 notice is the reverse of the CP39 notice. In this case, the IRS is informing you that they’ve taken your tax refund and applied it to your spouse or ex-spouse’s tax debt. Again, the underlying tax amount can often be wrong and you may be able to repair the old and new taxes to get the refund you deserve.
A CP44 notice is meant to notify you that the IRS is delaying your refund to determine whether or not you still owe taxes. If the IRS discovers that you do owe more, you will receive a CP49 notice.
A CP49 notice often follows a CP44 notice. The notice confirms that the IRS has applied your refund to other outstanding taxes. If you receive a CP49 notice, it’s important to investigate your case. Just because the IRS believes you owe taxes, doesn’t mean you actually do. Obtain the IRS file of your case and compare it to your own records to determine whether or not there were any discrepancies.
CP71 (A through D) notices are reminders that you still owe taxes. If you receive a CP71 notice, there is no need to panic just yet. However, you should take action to immediately to try to remedy the situation.
The receipt of a CP90 notice will require urgent action. A CP90 notice is a notice of intent to levy. The IRS is letting you know that they plan to take your assets and property. If you fail to respond in the correct way with the correct forms, the IRS can seize 90% of your wages and bank account balances.
A CP91 notice can be just as frightening as a CP90 notice. A CP91 notice means the IRS plans to take a portion of your social security check. The IRS can take up to 15% of your social security check after 30 days from the date of the notice.
A CP92 notice means the IRS has used your tax refund to pay for other outstanding taxes. You can appeal the seizure, but it is not always wise to do so. If you appeal, you extend the statute of limitations for all actions, even if the appeal doesn’t succeed.
The CP501 notice is designed to be a first reminder that you still have outstanding taxes due. At this point, the IRS cannot seize any of your property. You situation is not urgent, but action should be taken immediately to remedy the situation.
A CP503 notice is a follow up to a CP501 notice. This notice serves as a second reminder that you have outstanding taxes due. CP503H specifically regards Health Care Tax liability. If you still fail to take corrective action, the next notice you receive will likely be the CP504 notice.
A CP504 notice follows a CP503 notice. Unlike the CP503 notice, a CP504 notice is urgent. This notice lets taxpayers know that the IRS intends to levy against the taxpayer’s assets. If no action is taken, the IRS can seize just about anything you own 30 days after the date of the CP504 notice.
If you’ve entered into an installment agreement with the IRS, you may receive a CP521 notice. The CP521 notice is meant to remind a taxpayer that a monthly installment agreement payment is due.
If you fail to make a payment towards your installment agreement, you’ll likely receive a CP523 notice. The CP523 notice is designed to inform a taxpayer that an installment agreement has defaulted and the IRS intends to levy against the taxpayer’s assets. Notice CP523H may be received in regards to Health Care Tax liability. A CP523 notice should be taken very seriously. The IRS can seize your wages and property after 30 days from the date of the notice.
If you’ve filed a request for an installment agreement, you may unfortunately receive Letter 484C. Letter 484C notifies a taxpayer that the IRS has rejected a request for an installment payment agreement. However, the letter also offers an alternative payment amount.
Letter 1058 is similar in nature to Notices CP90 and CP504. The letter lets a taxpayer know that the IRS intends to levy against your the taxpayer’s assets. If no action is taken, the IRS can seize just about anything you own after 30 days from the date of the letter.
Letter 1741 may be issued in a small-dollar case, where the IRS delays a payment agreement to discuss information regarding your case. The IRS will request to speak with you regarding “income and expense information”. Usually, there are no issues, but it’s still best to go into a call prepared. The income and expense information the IRS is looking to discuss is contained in Form 433F.
Letter 2050 will request that you call the IRS to discuss overdue taxes. The number on the letter will be for Collections and not a help line. It’s important to research your case before calling. In certain cases, there may be no tax due.
Letter 2271C can be a relief for taxpayers to receive. Letter 2271C notifies a taxpayer that the IRS has accepted a request for an installment agreement. The letter will include the amount of your monthly payment, the fee for granting an agreement, and due dates for your payments.
Letter 2272C is the complete opposite of Letter 2271C. Letter 2272C notifies a taxpayer that the IRS has denied a request for an installment agreement. Usually, an installment agreement is denied due to evidence issues.
Letter 2273C is used to explain an aspect of an installment agreement. The letter may include information on where to send payments, what the “set-up-fee” will be to initiate the agreement, and more.
Beware of Letter 3172. The purpose of Letter 3172 is to inform a taxpayer that the IRS has filed a federal tax lien. You will immediately receive a flood of calls from tax resolution firms after a lien is placed, because tax liens are publically available. Approach the calls you recieve with caution. May firms relief, but don’t employ a single attorney on staff. They will take your money and leave you without any relief.
The IRS is not required to send Letter 3174, but will do so as a courtesy to taxpayers. Letter 3174 follows a Notice of Intent to Levy and is another reminder that there are overdue taxes. You should take immediate action to remedy the situation before the IRS seizes any of your assets.
Letter 3228 is similar to Notice CP71. The letter serves as a reminder that there are existing overdue taxes. Receipt of Letter 3228 does not indicate imminent danger, but action should be taken before things escalate.
The IRS will threaten you with failure-to-pay or failure-to-file penalties using Letter 5972C. Letter 5972C usually follows previous Collections letters, which you may have missed.
Notice LT11 is almost identical to Notice CP504. The notice informs a taxpayer that the IRS intends to seize assets and money as a result of overdue taxes.
Notice LT14 is similar to Notice CP71C. The IRS is looking to remind you of past due taxes and will request that you call them. It’s important to conduct research and obtain legal advice before following up and calling the IRS.
Notice LT16 informs a taxpayer that the IRS has assigned the case to enforced collection action. This could mean the will be assigned to a local revenue officer or IRS will continue to contact you via the IRS Automated Collections Service Center.
IRS Audit Notices & Letters For New Jersey Tax Payers
The CP75 notice series (CP75A, CP75C, CP75D) is meant for letter audits concerning the Head of Household filing status, the Earned Income Credit, or Dependency Exemptions. The notice will often come enclosed with Forms 886-H-HOH, 886-H-DEP, 886-H-EIC, 4564, or 886A. The forms will contain document requests and questions for you to answer.
Notice CP87A is sent if the IRS questions your ability to claim someone as a dependent. If you receive this notice, your tax benefits such as the Child Tax Credit, the Earned Income Credit, and the Head of Household filing status are at risk.
Letter 525 is a cover letter for Form 4549. The letter will outline the processes to take, whether you agree or disagree with the findings of an audit. It’s not advisable to sign Form 4549 without first obtaining legal advice.
Letter 531T is a Notice of Deficiency from the IRS. Should you choose not to agree with the results of an audit, the IRS you owe taxes. You will have 90 days from the date of Letter 531T to petition Tax Court. If you fail to file a petition, you will be assessed the tax.
Letter 566 is a combination of an audit notice and a request for information. The letter may be sent in conjunction with Form 4564 or Form 886A. It’s extremely important to answer the questions posed by the IRS and present the requested records or penalties will arise.
Like Letter 525, Letter 692 is used as a cover letter for Form 4549. It’s important that you receive legal advice before signing Form 4549. An IRS audit is a legal process and one that could come serious ramifications.
Letter 1912 is also used as a cover letter for Form 4549. Do not sign Form 4549 without first obtaining legal advice.
Letter 2202 can be stressful for any taxpayer to receive. Letter 2202 is used to inform a taxpayer of an audit. The IRS will ask to meet in person to ask questions in your home, office, or the IRS office. An audit is a legal process and obtaining legal advice is advisable.
Letter 2205-A is for individuals, whereas Letter 2205-B is for businesses. Letter 2205 is designed to inform a taxpayer of an audit. The letter usually includes an agent’s name and contact information. It’s advised to enter that information into your phone so that when the agent calls, you know who is calling. Obtaining legal advice is recommended if you receive Letter 2205.
Like Letter 531T, Letter 3219 is a “Notice of Deficiency”. If you decide not to agree with the results of an audit, the IRS will assume you owe taxes and send a Notice of Deficiency. You will have 90 days from receipt of Letter 3219 to petition Tax Court. If you fail to do so, you will be assessed the tax.
Letter 3572 is designed to inform a taxpayer of an audit. The IRS will request to meet with you in your home, office, or the IRS office. Because an audit is a legal process, obtaining legal advice is advisable.
IRS Business Notices & Letters For New Jersey Businesses
Notice CP15B lets a taxpayer know that they will be held responsible for the Trust Fund Recovery Penalty and will have Employer Business taxes imposed on them.
Notice CP102 is similar to Notice CP11 for individuals. Notice CP102 is used to inform a business that the IRS believes there is a mistake with a tax return. Businesses should take extreme precaution because the IRS can impose enormous penalties.
The IRS will issue Notice CP128 to let you know that the tax refund for your business will be applied towards a balance due in another period. If you receive a CP128 notice, it’s worth investigating further. Often, a business may not owe the amount that the IRS says is due, but a business owner does not know how to confront the issue.
Notice CP134B informs a business that an adjustment has been made to the account due to a discrepancy between tax deposits from Form 941 and what is reported on the tax return. The notice will show a balance due, but it may not be correct. The IRS may have applied payments to the wrong period or used payments to pay for back taxes. You should investigate to determine where the IRS has placed your payments.
CP138 is sent to inform a business that a refund is being applied to another tax period. You will have 60 days from the date of the notice to correct or appeal the decision. If you fail to do so, the business pay the tax and need to seek a Claim for Refund.
CP160 is sent as a reminder that past taxes are due. If you’ve received notice CP160, the IRS is not actively seeking enforced collection. This doesn’t mean you shouldn’t take action. Rather, this means you have time to investigate, research, and pursue your case to plot a course of action to receive relief.
Notice CP161 is used to inform a business that a balance is due. Notice CP161 is not meant to be a hostile notice, but the letters and notices following will gradually become more aggressive until the IRS issues a Notice of Intent to Levy. If you receive a CP161 notice, you should take action before the situation escalates.
Notice CP162 is used to notify a business that a delinquency penalty has been assessed a late-filed business tax return. The owner of the business is not personally liable for the penalty, but the process for fighting the action is essentially the same as if the penalty was assessed for an individual.
Notice CP163 is essentially the same as Notice CP160 and CP187. The IRS is simply notifying you that you have taxes due. Typically, the notice is sent for Employer Business Taxes for Form 941.
Notice CP171 is almost identical to Notice CP171C, which is sent to individuals. The IRS is looking to notify you that there are outstanding taxes owed by the business. At this point, your situation isn’t urgent, but you should take action to remedy the situation.
Notice CP187 is similar to Notices CP160 and CP163. All of these notices typically involve Form 941 for Employee Withholding Taxes. If you receive notice CP187, the IRS will not actively be seeking enforcement just yet. You still have time to conduct research and investigate various avenues for relief.
CP210 provides notice of an adjustment made to business taxes with your account. The explanation provided by the IRS for the adjustment may be vague or insufficient to truly determine why your return was deemed erroneous. You will have 60 days to respond to the notice. Before you respond, you should consult with a knowledgeable tax attorney. IRS penalties can be so high that they can completely cripple a business.
Notice CP230 will be received if an adjustment to your account has been made because IRS records differ from what was reported on your return. Considering IRS penalties can be steep for businesses, you should review your records carefully in order to correct the problem. It may be possible to earn an abatement of the penalties so your tax bill is reduced.
Notice CP259 is simply used to inform a business that the IRS failed to receive a specific business form. Typically, a request for Form 940 or Form 941 is made.
There are several different variations of Notice CP297 (297, 297A, and 297C). Notice CP297C is the most common variation or the CP297 family. Notice CP297 is meant to inform you that the IRS intends to levy against your property. On the other hand, Notice CP297A and CP297C inform you that the IRS has already seized some or all of your property. The IRS will invite you to file for a Collection Due Process hearing, but doing so will extend the Statute of Limitations on collection. If you receive any variation of a CP297 notice, you should immediately consult an attorney.
Notice CP504B is similar to Notice CP297 and requires the same sense of urgency. Notice CP504B indicates that the IRS intends to levy against your business assets. You should consult an attorney if you receive Notice CP504B.
Notice CP515B is similar to Notices CP516 and CP518. The IRS will request that you contact them immediately in regards to an overdue tax return. The return may be requested because the IRS thinks you owe, or you filed an extension, but never ended up filing a return. Penalties can be extremely harsh for businesses. It’s important you take action, espond to the notice and satisfy the IRS requirements. However, you should speak with an attorney first before responding.
Like CP515B, CP518B is sent to a business requesting certain returns to be filed. Again, it’s important you obtain legal advice and respond to the notice appropriately.
Notice CP2030 informs a business of a proposed change to a return. The notice indicates the IRS has information that didn’t appear to be on the business tax return. The notice is not meant to be a bill or notice of an audit. It is simply a mathematical adjustment based on third party records. Of course, the IRS may decide to audit you later.
Notice CP2531 is almost identical to CP2030. The IRS sends notice CP2531 to businesses or corporations to state that IRS records differ from what was reported on a business tax return. If you receive this notice, you should reconcile the IRS records with your tax return to understand what the IRS is proposing.
Notice LT26 is the almost the same as Notice LT18 sent to individuals. The notice is a request for business tax returns. It’s very difficult to prove you sent a return if the IRS believes they did not receive it. In these cases, your better off re-filing than arguing with the IRS.
Letter 98C servers as documentation for the mistakes the IRS believes you have made on returns filed for your business. In situations where multiple periods are in dispute, the IRS will take money from one period and apply it to another period, which can lead to discrepancies. You should obtain the Account Transcripts for all of the periods in question and compare them with your business records.
When a business fails to pay employee withholding taxes, the IRS will collect from individuals who could have paid the tax. Letter 1153 is used to propose an assessment of the Trust Fund Recovery Penalty against responsible individuals. You will have 60 days from the date of the letter to appeal the determination. If you receive Letter 1153, you should seek the help of a qualified tax attorney.
Letter 2475C in itself is no cause for concern. The letter is sent as a request for your address if the IRS does not have your correct address on file. The receipt of Letter 2475C could indicate a larger issue, because the IRS typically doesn’t need to contact you unless there is a problem. It’s worth reviewing your records to proactively correct a problem before one arises.
Letter 2788C is sent to a business owner as a notice that records need to be updated via Form 822B. Even though your business information will update with the filing of your next return, it’s important for you to be able to receive any IRS notices that arrive before then.
Letter 2975 should inspire urgent action. The IRS sends Letter 2975 to notify a business that the IRS intends to levy against business assets. The IRS will be cancelling your installment agreement and will seize your business assets after 30 days from the date of the letter. If you receive Letter 2975, you should consult with a tax attorney.
Letter 4108 is designed to be a cover letter for Forms 4666, 4667, and/or 4668. The forms will contain audit findings, which typically involve audits surrounding Forms 940, 941, or 944. The implications of an audit can be serious. If you haven’t already, you should consult a tax attorney to have your case reviewed.