Advocate Shahid’s perspective as the Tax Strategy and Advisory Specialist. The time given to respond to or act on a notice is usually 30 days from the date of the notice. The timing of deadlines, however, will depend on the type of letter that you are writing. Read your notice carefully, as some have a deadline of 10 days to pay or take some action, however formal tax court petitions will allow you 90 – 150 days.
How Long Do You Have to Respond to an IRS Notice?
This will depend on the type of notice. The best advice is to simply follow the IRS response due date listed on the notice and respond prior to that date. Some letters have IRS payment dates, and some letters have IRS notice/dates to appeal.
| IRS Notice Type | Common Deadline | What It Means |
|---|---|---|
| General IRS notice or letter | Date shown on notice | Respond if the IRS asks for action |
| CP2000 notice | 30 days, or 60 days outside the U.S. | Proposed underreported income adjustment |
| Letter 950 / 30-Day Letter | 30 days | Chance to request IRS Appeals review |
| CP504 / CP504B | Usually 30 days | Balance due / possible collection action |
| Letter 1058 | 30 days | Final Notice of Intent to Levy / CDP hearing request |
| Notice of Deficiency / 90-day letter | 90 days, or 150 days outside the U.S. | Deadline to petition U.S. Tax Court |
Why Did the IRS Send You a Notice?
There are numerous reasons the IRS will issue you an IRS notice, IRS letter, or IRS correspondence. Receipt of a tax notice doesn’t necessarily mean you are under investigation or in trouble. In some cases, the IRS is just seeking additional information or has already corrected a return or is clarifying the change in your refund/bill.
Some of the most frequent causes for an IRS notice are that a refund is being disbursed, the IRS is suggesting changes to your refund, the IRS is verifying your identity, the IRS is waiting for them to process a refund, income is not reported, they are proposing tax changes, there was a penalty or interest payment, or they are planning to collect. You can also get a tax bill notice from the IRS if it believes you owe money, a penalty notice if penalties were imposed or an audit notice if IRS selected your return for an audit.
The initial step is to carefully read the IRS tax letter. Search for the notice number, tax year, explanation, response deadline and instructions. If the IRS is proposing changes in your tax return, review it first before agreeing, paying or disputing any changes listed on the notice.
Where to Find the Deadline on Your IRS Notice
To find out how to verify IRS notice deadline, click on the first page of the letter. Please check the top right corner or the first page for the CP or LTR number. This number typically appears on the right, in the top corner, of the letter, according to the IRS.
Then, locate the area that includes the last date to petition or the area that includes “last date to reply” or “last date to respond.” This is the date for the IRS notice for which you should adhere. Don’t wait till the last day to respond to the IRS notice if it instructs you to do so.
Be sure to read the notice and follow the instructions. Request payment or documents, signed response form, or Tax Court petitions. Don’t assume the date that you opened the mail. There are some deadlines that are from the date of notice or the date it is mailed. In general, IRS notices will have information such as how many days the notice is valid for and may also include the last date on which to file a petition.
What If You Agree With the IRS Notice?
If you are in agreement with the IRS notice, complete the instructions that are printed on the notice. This could involve paying the IRS, filling out and submitting an IRS response form, correcting past tax returns or making a payment arrangement if you can’t pay the exact amount due. Taxpayers are not required to respond to the notice unless told otherwise unless they agree to the notice, according to the IRS.
When you are sent a letter by the IRS for payment, confirm the IRS says I owe money deadline and follow the directions for payment to avoid penalties, interest and collection notices from the IRS. If you qualify, you can make an IRS online payment, and get an IRS online payment agreement.
Example
Taxpayer is notified of tax due in a CP501 balance due notice. If the sum isn’t right, then you might want to pay online or even ask for a payment arrangement with IRS in advance of the arrival of additional penalties, interest or collection notices.
What If You Disagree With the IRS Notice?
Don’t ignore an IRS notice if you have an opinion. Any problems with the IRS notice should be addressed in writing, and the notice should be followed and a response made by the date specified. If taxpayers disagree with proposed changes, they are required to fill out the response form, submit a signed statement of disagreement and documents they wish reviewed, according to the IRS.
This can be presented with a written explanation, tax records, filled-in forms, evidence of payment, or anything else. Provide proof to IRS always by the means the IRS specified on the notice (mail, fax or the IRS Document Upload Tool). Provide copies, NOT original documents.
Example
The CP2000 is issued to a taxpayer when the IRS suspects that they didn’t report income from the sale of stocks. The taxpayer acknowledges the sale took place but not the tax as the cost basis was not included in the IRS’s assessment. Should include the CP2000 response form, a written explanation, Form 1099-B, brokerage statement, cost basis proof and the corrected schedule in front of the IRS proposed tax adjustment deadline.
How to Respond to an IRS Notice: Step-by-Step Solution
Step 1 — Verify the Notice Is Real
Look for the CP or LTR number, taxpayer’s name, tax year, amount and IRS contact details. IRS states that it is typically located in the top right hand corner of the letter.
Step 2 — Identify the Deadline
Look up the date of the answer, the date for paying, the appeal date, or date for a petition to the Tax Court. In the event that a response is needed, the IRS advises it be done by the due date.
Step 3 — Decide If You Agree or Disagree
If you consent, please follow payment/responsibility instructions. If you don’t agree, write a response to the IRS, discuss the problem and attach copies of supporting documents.
Step 4 — Gather Documents
Utilize a W-2, 1099, bank statements, receipts, previous tax returns, amended returns, brokerage statements or proof of payment. These records assist you with being able to reply to questions which are asked in IRS letter.
Step 5 — Respond Using the Method on the Notice
In response to the IRS notice, follow the instructions provided on the notice. The IRS response form or IRS mail response is available, along with the IRS fax response, and/or the IRS Document Upload Tool, depending on the notice. The IRS explicitly permits the upload, fax or mail of notices for CP2000.
Step 6 — Keep Proof
Maintain a copy of the notice, response, attachments, fax confirmation, upload confirmation, certified mail receipt or delivery tracking. This is helpful in case you have to prove at a later time how and when you responded.
Step 7 — Follow Up
Monitor IRS action via your IRS online account, and keep an eye out for IRS follow-up letters. Additionally, if the notice is complicated, you can reach out to IRS for notice or seek the help of a tax expert to examine the notice.
What Happens If You Miss the IRS Notice Deadline?
If IRS notice deadline has been missed, this will depend on the type of notice. Missing a deadline does not always spell the end of the case but may cause the issue to be more costly and result in a loss of rights.
| Notice Type | Possible Result |
|---|---|
| CP2000 or proposed adjustment | Proposed changes may move forward |
| Balance due notice | Penalties and interest may increase |
| CP504 / collection notice | The IRS may begin collection steps |
| Appeal letter | Appeal rights may be limited |
| Notice of Deficiency | Tax Court petition deadline may be lost |
If the due date of the IRS notice includes a CP2000, the IRS advises that if they don’t receive a response from you by the date of the notice, then they may issue a “Statutory Notice of Deficiency.
For CP504, Taxpayer Advocate Service informs that if IRS does not receive the amount paid within 30 days, then IRS can seize your state tax refund and will take other collection action.
Well, what will IRS do if I simply don’t reply to the IRS letter?So what do the IRS do if I just ignore the IRS letter? Late response penalty issues to the IRS can be additional IRS notices, IRS penalties, IRS interest, IRS action in collection, short appeal window, loss of Tax Court appeal, or any of the above. If the IRS notice deadline has already passed, answer as soon as possible rather than the next IRS notice.
IRS Notice Case Studies and Real-Life Examples
Case Study 1 — CP2000 Underreported Income Notice
A CP2000 is sent to a taxpayer when the IRS receives a Form 1099 that reports income that doesn’t match the return. Taxpayer must respond within 30 days (or 60 days if outside the U.S.). The answer is to compare the changes proposed by the IRS to the actual return, attach proof and submit the answer prior to the deadline using the IRS Document Upload Tool, fax or mail. The IRS will issue a Statutory Notice of Deficiency if it has not received a response to the letter by the due date.
Case Study 2 — Notice of Deficiency / 90-Day Letter
A Notice of Deficiency or 90-day letter (letter 3219) is sent to a taxpayer. If they disagree, and wish their case to be reviewed by Tax Court, they have 90 days from the date of the notice, or 150 days if outside the United States, in which to file a petition. If the deadline is not met, the taxpayer will be restricted in his/her ability to dispute the proposed tax before assessment.
Case Study 3 — CP504 Balance Due Notice
If a taxpayer does not pay by the due date of a CP501 notice and/or CP503 notice, he/she will get a CP504 notice. This IRS collection notice informs you that the IRS will take collection action if you do not pay or contact them within 30 days. What is practical is to deal with the IRS or IRS collection deadline by paying, asking for payment or for payment plans, or contacting IRS. If CP504 is not paid, other steps may be taken by the state to collect the tax refund.
Case Study 4 — Letter 1058 Final Notice of Intent to Levy
The IRS final notice / IRS levy notice date warning is sent as Letter 1058 to a tax payer. The IRS will send this letter when it is going to proceed with a tax levy. If a taxpayer wants to contest the letter, he or she is supposed to submit Form 12153 to the Independent Office of Appeals within 30 days after the date of the letter for a Collection Due Process hearing with the IRS, according to the IRS. Levy action can impact wages, bank accounts or other property if it is not addressed, resulting in a serious wage garnishment IRS notice or IRS bank levy notice situation.
Real Case Law to Mention
Boechler, P.C. v. Commissioner
The U.S. Supreme Court in Boechler, P.C. v. Commissioner ruled the 30-day deadline for filing a Tax Court petition challenging a Collection Due Process determination under section 6330(d)(1) is nonjurisdictional, meaning that it can be tolled in favor of the taxpayer under certain circumstances. This case is helpful for demonstrating that there are more issues hidden than are apparent with IRS deadline issues.
Culp v. Commissioner
The Third Circuit in Culp v. Commissioner ruled that the 90-day deficiency petition deadline in section 6213(a) was not jurisdictional, and is subject to equitable tolling. The court remanded the case back to the Tax Court to determine if the taxpayers were entitled to tolling. Care should be exercised as this is not a blanket exemption from the taxpayers to be able to ignore a Notice of Deficiency deadline.
Buller v. Commissioner
The Second Circuit found that section 6213(a)’s deficiency petition deadline was a claim processing rule that was nonjurisdictional and subject to equitable tolling, and remanded for consideration of whether the taxpayers deserved equitable tolling. This is an updated case law which demonstrates that courts are still grappling with the increasingly litigious nature of some tax petition deadlines.
Personal Experience
The largest tax resolution writing error people make is failing to read the precise type of notice that they are reacting to. A CP2000, CP504, Letter 1058 and Notice of Deficiency are not synonymous. Documents one, payment one, or Tax Court rights protection/cutting one. So, if you got an IRS notice, what should I do? Well, the first question is what is the number of the IRS notice, the deadline, tax year, proposed amount and what action is required.
This will also help you to answer questions such as: Do I need to respond to IRS letter? Should I call or write to the IRS? The best rule of thumb is to follow the instructions in the IRS notice and follow up if documents or proof are requested by the IRS, and respond in writing before the deadline to maintain appeal rights with the IRS.
Mistakes to Avoid When Responding to an IRS Notice
Taking a quick action in response to an IRS notice is not the only thing. Substituting one word with another can cause a larger tax issue, particularly when tax deadlines, appeal rights and Tax Court rights are at stake.
Ignoring the Notice Because You Think It Is a Mistake
Don’t assume that if you think an IRS notice is incorrect, then it isn’t. If you do not respond to an ignored IRS notice with proof, then it can proceed.
Missing the Response Deadline
If the deadline for IRS notice was missed, you could be subject to penalties, interest, collection action, and/or possibly limited appeal rights. When IRS appeal rights and/or IRS dispute rights are missing, or have been exhausted, it can be harder to resolve the problem.
Calling but Not Sending a Written Response
Contacting IRS can be helpful, but some notices must be responded to via a signed form or written response, or some have supporting documents. If the notice requests a written response, make sure to give written response.
Sending Original Documents
Do not send originals – only copies. Do not share your W-2s, 1099s, receipts, brokerage records or proof of payment with anyone.
Forgetting Key Details
Please make sure that the response form is signed, any notice copy is attached, the correct tax year is listed and all necessary documents are attached. Details are important, and without them, there could be a delay in the review.
Mailing Without Proof
Send certified mail, send a confirmation by fax, upload a confirmation or use approved delivery tracking. This will help to demonstrate that you reacted appropriately.
Assuming Every Notice Gives 90 Days
Not all letters from the IRS provide 90 days. Some notices provide 30 days, some contain payment dates and a Notice of Deficiency has unique Tax Court rules.
Waiting Too Long
Don’t put off for the final week to search for records. But if the tax court deadline slip-up occurs during the IRS’s response time, then you may be constrained. Don’t delay IRS response – if you missed IRS letter, please get in touch with a tax professional ASAP and ask if you can respond late to IRS notice based on the notice type.
When Should You Call a Tax Professional?
If the IRS notice requires more than just a minor correction, or a minor balance, then it is best to contact a tax professional. Smart is to get professional assistance when you receive a Notice of Deficiency, owe a lot of taxes, have been subject to an IRS levy, or have to file a Tax Court petition prior to the deadline.
Also, obtain assistance if you have wage garnishment risk, bank levy risk, federal tax lien risk, a business tax notice, a payroll tax notice, an IRS audit notice, missed deadline, unfiled return issue, or you disagree with the IRS, but don’t have the documents to support your claim.
An accountant or tax attorney can discuss the notice, IRS tax lien risk, IRS levy risk, IRS appeals, IRS reconsideration, and IRS appeals with you and help you request IRS appeal. The IRS Taxpayer Bill of Rights also provides the taxpayer with the right to a representative and the right to a hearing on a number of IRS decisions in an independent forum.
FAQs About IRS Notice Response Deadlines
How long do I have to respond to an IRS notice?
The majority of IRS correspondence must be responded to by the date that is written on the letter. The time period for a Notice is 30 days for some notices, 30 or 60 days if you’re outside the U.S. for CP2000, and 90 days or 150 days if you’re outside the U.S. for a Notice of Deficiency for a petition to the Tax Court.
Do all IRS notices have the same deadline?
No. IRS notice deadlines are dependent on the type of notice. Each of the following: CP2000, CP504, Letter 1058, 30-day letter, and Notice of Deficiency may have a different response time. The best guideline is to adhere to the exact date as shown on your IRS notice.
What happens if I miss the IRS notice deadline?
The IRS can proceed with proposed changes, value tax, impose penalties and curiosity; issue collection notices and/or restrict your appeal rights. If the deadline is missed, in severe cases, it may have an impact on your ability to attend Tax Court.
Can I respond late to an IRS notice?
There’s still time to make some sort of response but you may have a late response that does not preserve all rights. If the notice is related to the Tax Court deadline, appeal deadline, levy notice or Notice of Deficiency (NOD) proceed quickly and seek assistance.
Do I need to respond if I agree with the IRS notice?
Typically, when you agree, you comply with the instructions in the notice and you pay or take a specific action or sign a form required by the notice. Unless the notice is asking for a response, you don’t have to respond to it, the IRS says.
How long do I have to respond to a CP2000 notice?
The IRS should receive a response to a CP2000 notice within 30 days from the notice date or 60 days for those outside the United States. The IRS Document Upload Tool, fax or mail can all be used for sending responses.
How long do I have to respond to a Notice of Deficiency?
A Notice of Deficiency typically provides a 90-day (or 150 day with respect to a non-U.S. citizen) period to challenge the deficiency in front of the Tax Court. The IRS could end up penalizing you for missing the deadline with a proposed amount.
Should I call or write the IRS after receiving a notice?
Follow the directions on the notice. Additionally, a phone call might not be sufficient if the IRS requests documents or a written explanation. Make copies of the notice, your reply, documents and proof of mailing, faxing or uploading.