The first move
Before you pay, match the notice to your return and your payment records. The most common cause of a wrong bill is a payment the IRS did not credit to the right year.
What these letters have in common
A balance due notice means the IRS processed a return (yours, or one it prepared for you) and the tax on it is more than what was paid. The first one is a CP14 for individuals or CP161 for businesses. If nothing happens, the series escalates: CP501, CP503, CP504, and then the final collection notices. Each step adds interest and shortens the response window.
The bill is usually right. When it is wrong, it is wrong for a small number of reasons: an estimated payment applied to the wrong year, a payment made under a spouse's number, a math correction you did not expect, or a penalty you can have removed. Reading the notice against your own records takes twenty minutes and is the whole difference between paying and disputing.
Paying late costs 0.5 percent a month plus interest. Not responding costs a levy. Nothing in this family is an emergency on day one, and everything in it becomes one if the series runs to the end.
What to gather
- The notice, all pages, including the payment stub
- The return for the year on the notice
- Confirmation numbers for every payment you made for that year (Direct Pay, EFTPS, card, cancelled checks)
- Any prior notice for the same year
- Bank statements if a payment is missing
How to write back
- First-time penalty abatement request letter: If you have filed and paid on time for the past three years, the IRS will usually remove a failure-to-file or failure-to-pay penalty once. This letter asks for it.
- CP14 response letter: A short letter that responds to a balance due notice: what you are paying, what you dispute, and what you are attaching.
- Payment plan request cover letter: A cover letter to accompany Form 9465 or an online payment plan confirmation, stating the balance, the proposed monthly amount, and the first payment date.
Notices in this family
| Notice | What it means |
|---|---|
| CP14 | Balance due on a filed return, the first bill |
| CP14H | Shared responsibility payment balance (obsolete provision) |
| CP14I | Balance due related to an IRA or retirement account issue |
| CP51A | The IRS computed your tax on a return you filed and you owe |
| CP51B | Same as CP51A, with a different computation basis |
| CP51C | Same as CP51A, where the IRS made a change |
| CP60 | A payment was removed from your account and you now owe |
| CP71 | Annual reminder of a balance still owed |
| CP71A | Annual reminder, account in currently-not-collectible status |
| CP71C | Annual reminder with a passport-related warning |
| CP71D | Annual reminder, balance includes an assessed penalty |
| CP71H | Annual reminder, obsolete provision |
| CP128 | Balance due after a payment was applied to a different period |
| CP160 | Business balance due reminder |
| CP161 | Business balance due, the first business bill |
| CP171 | Business annual reminder of a balance owed |
| CP187 | Business balance due after a return was filed or adjusted |
| CP501 | First reminder of an unpaid balance |
| CP503 | Second reminder of an unpaid balance |
| CP504 | Notice of intent to levy your state tax refund |
| CP601 | Spanish-language CP501 |
| CP603 | Spanish-language CP503 |
| CP604 | Spanish-language CP504 |
When to get help
If the balance is more than you can pay within 180 days, if it includes payroll tax, or if you have reached CP504, talk to a professional before the next letter arrives.
Before you send anything
This is general information, not tax advice. Situations differ. Check with your tax advisor before you send anything. Nothing on this page creates a client relationship.