IRS CP504: IRS Intends To Levy Assets – Meaning & Actions Needed

cp 504 noticeThe only thing taxpayers want to receive from the IRS is a tax refund in the form of a check or direct deposit to a bank account. As a general rule, any other correspondence from the IRS is not a positive experience. When the IRS sends notifications to taxpayers that they owe money, the language used in the correspondence can be quite intimidating. This is due to the fact that the IRS, unlike creditors, have very powerful and efficient methods of collecting money owed. Here we look specifically at the IRS Notice CP504 and what it means if you receive this notice from the IRS.

What is CP504?

Taxpayers who receive a CP504 from the IRS are being notified of the IRS’s intention to issue a levy against a state tax refund. In addition to placing a levy on state tax refunds, the IRS is also letting the taxpayer know that a search for other assets may be happening as well as the potential to issue a tax lien on property (if it not already present). In essence, those who receive a CP504 must take this notice seriously as the consequences of ignoring one can have a negative impact on your personal finances. However, this is generally not the “final” notice of intent to levy. The final notice has to let you know of your rights to a hearing 30 days before the IRS levies a bank account or your wages.

Who Do I Contact With Questions?

If you have received notice CP504 and have questions regarding the notification, you can call the number printed on the top of the correspondence to speak to an IRS representative. You can also contact us and we can connect you with a tax firm for a free consultation.  It is very important to not ignore this notice as the consequences of doing so will have a negative impact on your personal finances. Even if you do not have the money to pay the amount owed, you must contact the IRS to avoid additional collection actions. It is recommended to reach out to a tax professional if you cannot pay in full. You can request a free consultation to understand your options and the fees by calling the toll-free number above.

How Do I Pay?

If you have the money needed to pay the bill in full, you can simply mail the payment including the bottom portion of the notice in the envelope supplied with the notice. This will ensure your payment is properly credited and further collection activities cease. If you do not have the amount needed to pay the bill in full, you must contact the IRS to discuss payment options. This may include an installment plan or other options which allow you to make regular payments to resolve your tax issue. If you fail to respond to this notice, either by making a full payment or payment arrangements, additional collection actions may be taken against you. This may include the seizure of any state refunds owed to you or the placement of a lien against your property until the tax liability is paid in full.

I Don’t Agree With This Notice- What Do I Do?

Perhaps you have dealt with this problem in the past and believed it to be resolved? Or perhaps you don’t agree that you owe the liability in the first place. Again, even if you do not agree with the notice, it is imperative that you contact the IRS to avoid collection actions. It may be necessary to have the Office of the Taxpayer Advocate involved to resolve the matter if an agreement cannot be reached between yourself and the IRS.