IRS Notice CP90 Explained
If you’ve received an IRS Notice CP90 in the mail, it’s important to understand what it means and what steps you must take.
TABLE OF CONTENTS
- IRS Notice CP90 is issued to taxpayers to inform them that the IRS intends to issue a levy on their assets due to missed tax payments.
- The types of assets that collection agencies can levy to collect payment for federal, state, and local tax payments due include bank account funds, wages or tips from work, social security income, an income tax refund, and any physical assets like property or vehicles.
- Taxpayers have 30 days to respond from the date listed on the CP90 Notice to respond and pay their taxes, or else it will be considered late and they will no longer have the right to an appeal hearing and the IRS will begin levying their assets.
- Taxpayers can respond to IRS Notice CP90 by paying their tax bill, requesting tax relief through an offer in compromise or installment agreement, or requesting a Collection Due Process hearing.
What Is IRS CP90?
Notice CP90 is issued to taxpayers to inform them that the Internal Revenue Service (IRS) plans to issue a levy on certain assets to seize payment for not paying their tax bill by the deadline. The types of assets that collection agencies can levy to collect payment for federal, state, and local tax payments due include bank account funds, wages or tips from work, social security income, an income tax refund, and any physical assets like property or vehicles. Need assistance filing your taxes? See how you can get the largest refund here.
What Happens If You Do Not Respond To The IRS CP90 Notice?
If taxpayers ignore the IRS CP90 notice that warns taxpayers of its intentions to issue a levy on their assets, they are at risk of being sent to collections.
How Long Do You Have To Respond To Notice CP90?
If someone receives IRS Notice CP90, they have 30 days from the date listed on the notice to respond and pay their taxes, or else it will be considered late and they will no longer have the right to an appeal hearing and the IRS will begin levying their assets.
How To Respond To The IRS CP90 Notice?
It is important that taxpayers do not ignore receiving the IRS CP90 Notice in the mail or else the IRS will
1. Read Your IRS Notice Carefully
Within the IRS CP90, taxpayers can learn all of the information they need about the IRS’s intent to levy, the timeline of action, and how to move forward in resolving the issue.
2. Pay Your Tax Liability
The most efficient next step to resolve your tax problem is to submit a payment for the full tax balance that you owe to the IRS.
Here are the different ways that taxpayers can submit their tax payments:
- Direct deposit from their bank accounts
- Mail a check or money order
- Electronic funds withdrawal during the e-filing of their tax return
- Schedule estimated payments
3. Request Tax Relief
If you are unable to pay your tax bill by the deadline, there are steps you can take to prevent the IRS from moving forward with the levy and save you from additional financial hardship. Two of the most popular options of the IRS Fresh Start Program individuals can find during this tax situation include installment agreements and offer in compromise.
Offer In Compromise
An offer in compromise is a form of tax relief in which the IRS agrees to settle the tax debt for less than what was initially owed if the taxpayer pays the settled amount in full.
An installment agreement is a form of tax relief in which the IRS permits the taxpayer to pay off their tax debt through a payment plan. The taxpayer will submit monthly deposits for their payment plans until the debt is paid off. The taxpayer will be responsible for all fees, penalties, and interest accumulated during this extension time.
4. Request A Court Hearing
The third and final option for taxpayers who receive IRS Notice CP90 is for them to request a Collection Due Process hearing, using Form 12153, Request for a Collection Due Process, or Equivalent Hearing, if they disagree with the notice and wish to appeal it.
If you need help understanding your IRS notice, navigating a tax audit, or determining which credits and deductions can achieve your tax savings this year, get tax help from a professional here at Ideal Tax. We offer a free tax consultation.