Unless you're expecting an income tax refund check in the mail, an envelope from the IRS can be stressful and alarming. The Internal Revenue Service sends out countless notices and letters to taxpayers regarding their federal tax accounts. One of these notices is the CP14, which is sent to a taxpayer who owes money on unpaid taxes.
Why did the IRS send you a CP14 notice?
When you file a tax return, whether for the current year or a past year and are unable to pay the balance of tax owed at the time of filing, the IRS will send you a CP14 notice in the mail. The timeframe for receiving the notice may vary depending on if the tax return was e-filed or paper filed. You can reasonably expect to wait 4-6 weeks for an e-filed return or 3-5 months for a paper-filed return before receiving the notice.
The CP14 is simply letting you know that you have a tax balance due. It will include the following information:
The tax year or period for the tax assessment
The amount of tax owed, any payments and credits applied, penalties, and interest
The deadline for submitting the payment in full
It is important to respond to the IRS by the deadline on the notice. Failing to do so will guarantee additional (and more aggressive) notices to be mailed to you. Although there are circumstances when the IRS may call a taxpayer, they will not leave pre-recorded, urgent, or threatening voicemails.
Beware of tax scams involving emails, texts, or phone calls that demand payment.
Why did you receive a CP14 notice when you already paid the tax balance?
If you've paid your taxes within the past 21 days, the IRS may have sent out the notice before the payment was received. If this is the case, you can disregard the notice. However, It is crucial to review the CP14 carefully to ensure the amount owed isn't due to penalties or interest. If you paid your taxes in full, but after the tax filing deadline, you may have received the CP14 notice so that the IRS can collect interest and the failure-to-pay penalties.
What to do if you agree with the tax owed
Carefully review the notice and decide whether you agree with the taxes owed. If you aren't disputing the amount, you must then decide how you will pay the liability. You can either:
Pay in full by the deadline on the notice
Request an installment agreement
Request an extension to pay in full - You will have an extra 180 days to pay the balance in full. However, taxes owed (including penalties and interest) must be less than $100,000.
Options for those in financial hardship including currently not collectible status or an offer in compromise
What to do if you disagree with the tax owed
If you believe the tax owed is incorrect, call the phone number listed on the IRS Help section of the CP14 notice. Have the notice and any supporting documents (canceled checks, amended returns, etc.) ready when you call the IRS.
What happens if you ignore the CP14 notice or miss the payment deadline
Ignoring the CP14 notice or missing the deadline to pay will lead to additional IRS notices, such as the CP501, CP503, and CP504. Each of these notices becomes more aggressive/threatening. If left unresolved, the IRS may begin taking collection activities that include but are not limited to:
Filing a lien against your assets
Garnishing your wages
Levying your bank account
Garnishing your Social Security benefits or pension payments
Seizing your assets
Get help with your tax troubles
A tax resolution practitioner (an IRS-licensed Enrolled Agent, CPA, or tax attorney) can help assist you in dealing with the IRS. Call our office at (267) 551-1465 or book a free consultation through our website to discuss your situation in confidence. We can help you decide whether or not hiring professional help makes sense for you.
Legal Disclaimer: The contents of this blog and all posts within it are for informational use only and are not intended to be legal advice. This blog is designed to provide general information regarding the subject matter covered. It is not intended to serve as legal, tax, or other financial advice in any capacity. For specific advice regarding your own tax situation, consult with a licensed tax professional or tax attorney.
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