The Notice CP504 (also referred to as the Final Notice) is mailed to you because the IRS has not received payment of your unpaid balance and tells you how much you owe, including additional penalties and interest, when it’s due, and how to pay before further collection action takes place.
This notice is your Notice of Intent to Levy (Internal Revenue Code Section 6331 (d)). If the IRS does not receive the amount due within 30 days from the date of this notice, the IRS can levy your state tax refund. IRS may also serve a Disqualified Employment Tax Levy or a Federal Contractor Levy, as explained in the enclosed Publication 594, The IRS Collection Process. In most other situations, before the IRS issues a levy on your property or rights to property, IRS will send you a notice that gives you the opportunity to request a Collection Due Process (CDP) hearing, unless you have already received one.
The Notice CP504 provides various options on how you can pay the balance due (e.g., via electronic payment options on Pay Your Taxes on IRS.gov or via check or money order payable to the United States Treasury).
If you can’t pay the full amount by that date, you need to figure out what payment options might work for your situation, and act to set up a payment plan or discuss other ways to pay off your balance. Being proactive in addressing the tax debt may prevent additional penalty and interest charges and eliminate the need for the IRS to take action to collect the balance. For specifics, see I got a notice from the IRS.
If you choose not to respond to the Notice CP504, the IRS may send you a collection notice requiring payment with your right to request a Collection Due Process hearing (e.g., your appeal rights via a Notice of Intent to Levy and Your Notice of a Right to a Hearing), before taking further action to collect the balance due. This further collection action could include the IRS levying or seizing your wages and other income, bank accounts, business assets, personal assets (including your car and home), retirement accounts (including the Thrift Savings Plan), Alaska Permanent Fund Dividends, and Social Security benefits up to the amount the taxpayer owes.
If you have not paid the debt already, a federal tax lien has arisen as a claim against all your property. If you don’t pay the amount due immediately or make payment arrangements, the IRS can file a Notice of Federal Tax Lien (NFTL) publicly establishing their priority with your creditors or the IRS may levy (subject to any applicable Collection Due Process rights). If the IRS files the NFTL, it may be difficult to sell or borrow against your property.
This notice also explains the possible denial or revocation of your United States passport. Visit Revocation or Denial of Passport in Case of Certain Unpaid Taxes for further information.
For specifics on your particular notice, visit Understanding your IRS Notice or Letter.
