A CP90 notice from the IRS means the government is preparing to take collection action against you for unpaid federal taxes. The notice, formally called a Final Notice of Intent to Levy and Notice of Your Right to a Hearing, warns that the IRS may seize your property or rights to property if you do not resolve the tax debt.
Receiving CP90 can be stressful, especially if you were not expecting the IRS to move toward a levy. You may still have options, but the deadline in the notice matters.
Gabaie & Associates, LLC helps taxpayers in Frederick respond to IRS collection notices, challenge incorrect tax debts, and pursue solutions that may stop or limit collection activity.
Call (410) 358-1500 or contact us to discuss your CP90 notice.
What Is an IRS CP90 Notice?
A CP90 is a Final Notice of Intent to Levy and Notice of Your Right to a Hearing. The IRS sends it when you have an unpaid tax balance, and the agency intends to use a levy to collect the debt.
A levy is different from a federal tax lien. A lien is a legal claim against property as security for a tax debt. A levy is the actual seizure of property or rights to property to satisfy the debt.
The CP90 notice generally identifies the tax period involved, the amount the IRS says you owe, and the steps you can take to address the collection action.
The notice also provides information about your right to request a Collection Due Process (CDP) hearing. This hearing can give you an opportunity to raise certain issues with the proposed levy and discuss collection alternatives with the IRS.
Is CP90 the Final Notice Before an IRS Levy?
CP90 is one of the IRS notices that can serve as a final notice of intent to levy. It is therefore important not to treat it like an ordinary balance-due letter.
The IRS may levy certain property and financial assets if the tax debt remains unresolved and the required collection procedures have been followed. Depending on your circumstances, an IRS levy could affect:
- Bank accounts
- Wages or other income
- Accounts receivable
- Certain retirement or investment assets
- Vehicles or other property
- Other property or rights to property
Federal law places limits on some types of property and income, and the IRS must follow specific procedures before making a levy.
A CP90 does not mean that the IRS has already seized your property. It means the agency is warning you that levy action may occur if the debt is not addressed.
What Should I Do After Receiving CP90?
Start by reviewing the notice carefully. Confirm the tax years involved and compare the balance shown on the notice with your own tax records.
If you agree that you owe the debt, you may need to contact the IRS or pursue a collection option before the IRS moves forward with the levy.
If you disagree with the amount, believe the tax was already paid, or think the IRS is pursuing the wrong taxpayer, those issues should be addressed rather than ignored.
You should also pay close attention to the deadline for requesting a Collection Due Process hearing. Waiting until the IRS has already levied your property can limit your options.
What Is a Collection Due Process Hearing?
A Collection Due Process hearing gives eligible taxpayers an opportunity to challenge certain IRS collection actions before an independent Appeals officer.
For a CP90 notice, you generally have 30 days from the date of the notice to request a hearing and preserve your right to a CDP hearing. The IRS provides instructions with the notice explaining how to make the request.
A CDP hearing may allow you to raise issues such as:
- Whether you owe the tax
- Whether the IRS followed required collection procedures
- Whether you qualify for certain collection alternatives
- Whether a proposed levy is appropriate under the circumstances
- Whether another resolution may address the tax debt
You may also be able to propose a collection alternative, such as an installment plan agreement or Offer in Compromise, when you meet the applicable requirements.
The exact issues available in a CDP hearing depend on the circumstances of your case. A tax attorney can help determine which arguments and collection options may apply.
What Happens If I Miss the CP90 Deadline?
The CP90 deadline is important because requesting a hearing on time can preserve your Collection Due Process rights.
If you miss the 30-day period, you may still have other ways to address the tax debt or request a hearing in some circumstances. However, the type of hearing and your available appeal rights can be different.
Missing the deadline also does not stop the IRS from continuing collection activity when the agency is otherwise authorized to do so.
If the deadline has already passed, that does not necessarily mean you have no options. Your attorney can review the notice, the tax liability, and the history of IRS collection activity to determine what steps may still be available.
How Can a Frederick Tax Attorney Help With CP90?
A CP90 notice can involve both a tax debt and an immediate collection threat. Our team at Gabaie & Associates, LLC can review your IRS notices and tax records to determine what the IRS is seeking to collect and what options may be available.
Depending on the circumstances, the firm may help you:
- Review the IRS’s calculation of your tax debt
- Determine whether the proposed levy can be challenged
- Request a Collection Due Process hearing
- Evaluate installment agreement options
- Determine whether you may qualify for an Offer in Compromise
- Seek currently not collectible status when appropriate
- Address other IRS collection issues
The goal is to address the tax problem before it leads to the loss of money or property.
What Can I Do About the Tax Debt Listed on CP90?
Receiving a CP90 does not necessarily mean you have to pay the entire balance immediately. The IRS offers several ways to address unpaid tax debt, depending on your financial situation and the circumstances of the case.
If you can afford to pay the balance, paying it in full generally stops collection action for that liability. If you cannot pay everything at once, you may be able to request an installment agreement or another collection alternative.
An Offer in Compromise may also be an option for taxpayers who meet the IRS requirements. This allows eligible taxpayers to settle their tax debt for less than the full amount owed.
In some cases, the IRS may temporarily delay collection because paying the debt would create financial hardship. This is sometimes referred to as currently not collectible status.
The right option depends on factors such as your income, expenses, assets, and the amount and type of tax debt involved.
What Happens at a CP90 Collection Due Process Hearing?
If you timely request a CDP hearing, the case generally moves to the IRS Independent Office of Appeals.
The hearing gives you an opportunity to raise qualifying collection issues and propose alternatives to the levy. Depending on the circumstances, you may discuss a payment plan, Offer in Compromise, or another collection solution.
You may also be able to dispute the underlying tax liability in limited circumstances, such as when you did not previously have an opportunity to challenge it.
The Appeals officer will consider the information presented and determine whether the proposed collection action meets the applicable requirements.
If you want the Appeals officer to consider a collection alternative, providing complete and accurate financial information can help support your proposal. The IRS notes that timely CDP requests can also preserve the taxpayer’s right to seek judicial review of the Appeals determination.
CP90 Notice FAQs
Does CP90 mean the IRS will levy me immediately?
No. CP90 is a final notice of intent to levy, but receiving the notice does not mean your property has already been seized. The notice gives you an opportunity to respond before the IRS proceeds with the proposed levy.
How long do I have to respond to CP90?
You generally have 30 days from the date of the CP90 notice to request a Collection Due Process hearing. The IRS instructions included with your notice should be reviewed carefully because the applicable deadline is important.
Can I stop a levy without going to a hearing?
Possibly. Paying the balance, entering into an approved payment arrangement, or qualifying for another collection alternative may resolve the issue without a CDP hearing. The appropriate option depends on your circumstances.
What if I already received a CP90 and cannot pay?
Do not ignore the notice simply because you cannot afford the balance. Depending on your finances, you may qualify for an installment agreement, Offer in Compromise, currently not collectible status, or another collection solution.
Get Help With a CP90 Notice in Frederick
A CP90 notice means the IRS is moving toward enforced collection, but you may still have an opportunity to address the tax debt before a levy takes place.
Gabaie & Associates, LLC can review your CP90 notice, tax balance, financial circumstances, and collection history to help determine what options may be available. The firm can also help you respond to the IRS and pursue a collection alternative when appropriate.
If you received a CP90 notice in Frederick, do not wait until the IRS has already levied your property to start addressing the problem.
Call (410) 358-1500 or contact the firm online to discuss your IRS collection matter.
