Every year, millions of Americans receive IRS notices and do nothing — hoping the problem will go away. It won’t. Here’s a guide to the most common notices, what they actually mean, and how to respond.
CP2000: Underreported Income
This is one of the most common notices and usually results from a mismatch between income you reported and what third parties (employers, banks, clients) reported to the IRS. It is NOT an audit — it’s a proposed change. You have 60 days to agree, disagree with documentation, or request an installment agreement. Ignoring it converts the proposed amount into an assessed tax balance with penalties and interest.
CP503 / CP504: Balance Due
These are escalating collection notices. The CP504 is particularly serious — it’s the final notice before the IRS begins enforcement action (levies, liens). If you receive a CP504, respond within 30 days. Options include paying in full, requesting an installment agreement, submitting an Offer in Compromise, or requesting Currently Not Collectible status.
LT11 / Letter 1058: Final Notice of Intent to Levy
This is the most urgent notice you can receive. It means the IRS is about to seize assets — wages, bank accounts, business receivables, property. You have 30 days from the date of the letter (not the date you received it) to request a Collection Due Process (CDP) hearing. Missing this deadline removes most appeal rights.
CP90: Notice of Intent to Seize Assets
Similar to the LT11, this notice specifically relates to seizure of physical assets. Get professional help immediately.
The Rule: Respond to Every IRS Notice
Every notice has a response deadline. Missing it either eliminates your options or adds penalties. Never ignore an IRS notice. Read it carefully, note the deadline, and either respond yourself (for simple matters like CP2000 where you agree) or engage a qualified tax professional.
How Mac Angelo Can Help
We handle IRS resolution for businesses and individuals — from CP2000 responses to Offer in Compromise negotiations. Most situations are more resolvable than clients expect when addressed proactively.
