IRS Notice Decoder
Notice CP504: Notice of Intent to Levy
This is a serious letter, but it is also a solvable one. Here is what it means, the timing it sets, and the options you have.
What CP504 means
The IRS sends CP504 when it hasn't received payment of an unpaid balance. It is the formal notice of intent to levy required by Internal Revenue Code section 6331(d). In practice:
- The IRS is asking you to pay the amount shown immediately.
- If the balance stays unpaid, the IRS can levy (take) your state income tax refund, and it says it will begin searching for other assets it could levy.
- The IRS may also file a Notice of Federal Tax Lien if it hasn't already. A lien is a public claim against your current and future assets and can affect your ability to get credit.
- The notice also explains that seriously delinquent tax debt can lead to denial or revocation of a U.S. passport.
Timing calculator
The IRS asks for payment immediately. Separately, federal law says a notice of intent to levy must be given no less than 30 days before the day of the levy (IRC §6331(d)(2)). Enter the date printed on your notice to see the 30-day mark.
Always go by the dates and instructions printed on your own notice. The 30-day count here starts from the printed date. The law counts from when the notice is given or mailed, so the exact timing can vary. The 30 days is not a grace period: the IRS can still levy a state tax refund, and interest and penalties keep growing until you pay.
Sources: IRS CP504 page; 26 U.S.C. §6331(d)If it is ignored, and what usually comes next
If you don't pay or make payment arrangements, the IRS says it can:
- File a Notice of Federal Tax Lien, which can make it hard to sell or borrow against property and can hurt your credit.
- Levy any state tax refund you're entitled to.
- Send a notice giving you the right to a hearing before the IRS Independent Office of Appeals, if you haven't already received one. Depending on your situation, this is either LT11 or Letter 1058 (final notice of intent to levy and your right to a Collection Due Process hearing).
- Then levy other property, including wages and other income, bank accounts, business assets, personal assets (including a car or home), and Social Security benefits.
What you can do yourself
- Read the notice carefully. It shows how much you owe and your payment options.
- Pay in full if you can, online or by mail in the IRS envelope, with the bottom part of the notice included.
- If you can't pay it all, pay what you can now, then ask for a payment plan (installment agreement). The IRS Online Payment Agreement tool is the fastest way to get one approved. If you owe less than $50,000, you may be able to set it up online. You can also call the number on your notice or use Form 9465.
- If you disagree, call the toll-free number on your notice right away.
- If you already paid or set up an installment agreement, still call so your account shows it.
- You can ask for an appeal under the Collection Appeals Program (CAP) before collection action, by following the instructions on your notice.
When to bring in an Enrolled Agent
Enrolled Agents are licensed by the IRS and can represent taxpayers before it. The IRS notes that you can authorize someone to contact it for you. Consider getting help if:
- You can't pay in full and aren't sure which payment plan fits.
- You owe more than the online payment plan allows, or you have tax returns that haven't been filed.
- You think the balance is wrong, or a payment wasn't credited.
- You've already received LT11 or Letter 1058, or you're worried about a levy on wages, bank accounts, or business assets.
- You'd rather not deal with the IRS phone line yourself.
Official IRS resource
Read the IRS's own explanation: Understanding your CP504 notice (irs.gov).
This page is general information, not tax or legal advice. It doesn't create a client relationship. Advice for your situation starts only after a formal engagement with Tristan D. Taylor, EA. Always follow the instructions on your own notice.