IRS certified letters address everything from unpaid taxes, liens and levies, and tax return changes to audits and examinations, ID verification, and more. For these tax issues, the IRS is legally required to have documented proof that a taxpayer received a certified letter.
This proof serves as legal evidence if the issue proceeds to civil or criminal court. Taxpayers receiving certified letters from the IRS should respond promptly to the tax issue described in the letter or notice.
The IRS will not mail certified letters for low-priority tax matters. These would include updating contact information or reminders of an upcoming payment due for an Installment Agreement.
Balance Due Notices
Balance due reminders inform a taxpayer of the deadline to pay the balance due for unpaid taxes before the IRS begins collections. Not paying a tax debt can lead to wage garnishment, bank account levies, and the IRS seizing your car or home.
Balance due notices include CP11, CP14, CP501, CP503, and LT16.
Tax Lien Letters
Letter 3172 notifies a taxpayer that the IRS will file a federal tax lien against real estate property, personal property, or other valuable assets.
This notice explains that you have the right to request a Collection Due Process hearing if you want to dispute the lien and provides details of what property will have a lien.
Intent to Levy Notices and Letters
A CP504 Notice of Intent to Levy is sent when a taxpayer owes back taxes and the IRS plans to seize assets. When the IRS issues a levy, they can take wages, bank accounts, investments, retirement funds, homes, vehicles, and more.
A CP504 notice does not mean the IRS has already seized assets, but they will begin taking them if the recipient does not pay off the tax debt or make payment arrangements.
The final notice sent by the IRS before a levy is Letter 1058 (or LT11), which gives the taxpayer 30 days to settle unpaid taxes, request a Collection Due Process hearing, or establish a payment plan.
If a taxpayer does nothing within that 30-day window, the IRS will start to seize the assets described above. Keep in mind that requesting a
Collection Due Process hearing can temporarily stop a levy while the case is reviewed and adjudicated.
A few other notices you may receive related to a lien or levy are CP90/CP297, CP91/CP298, and CP523.
Tax Return Change (Notice of Proposed Adjustment for Underpayment/Overpayment)
A CP2000 letter notifies taxpayers that the IRS has found discrepancies in their tax return regarding income and deductions or credits reported. They will not change the return until the taxpayer responds to the notice to either agree or disagree with the IRS findings.
If a CP2000 notice is for underpayment of taxes, the taxpayer must pay what is owed by the deadline to avoid penalties.
Identity Verification Letters
Receiving Letter 4883C means the IRS has received a tax return filed using your Individual Tax Identification Number (ITIN) or Social Security number (SSN) and suspects identity theft.
The letter contains instructions for contacting the IRS to resolve this problem. If the IRS needs additional identity verification documentation, a 5747C letter may be sent after a taxpayer receives Letter 4883C.
If you receive Letter 5071C, you can use the IRS online tool to verify your identity. It allows taxpayers to tell the IRS whether they filed a return that year.
Some identity verification letters may require recipients to appear at their local IRS center to verify their identity with a tax agent.
Notice of Deficiency
A CP3219A Notice of Deficiency (also called a 90-day letter) indicates the IRS has information that differs from the information reported on a person’s tax return.
If this discrepancy results in owing taxes, the recipient of this notice is given the chance to agree or disagree with the proposed modifications. The IRS allows taxpayers 90 days to accept or dispute the additional tax liability or challenge the change in Tax Court.
Examination (Audit) Letter
Letter 2205-A notifies taxpayers that their tax return is under audit. It explains which tax years are being audited, what items have been selected for examination, and how the recipient needs to respond to the audit.
In most cases, you will need to provide specific financial documents by a deadline to one or more IRS agents managing the audit. Letter 2205-A may also explain that a taxpayer is under an “in-person” audit and will need to meet directly with IRS agents to resolve tax issues.
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