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Got an IRS CP504 Notice? What It Means and What to Do
A CP504 is a notice of intent to levy. The IRS is telling you it can seize a state tax refund now and other property later if the balance is not paid or arranged.
Reviewed by LaToya Clark-Thompson, FounderLast updated
What this letter is
The CP504 is a notice of intent to levy under section 6331(d) of the Internal Revenue Code. The IRS sends it when it has not received payment of an unpaid balance after earlier notices such as the CP14, CP501 and CP503. The IRS describes it as a final reminder before it levies, meaning seizes, property or income, and it asks you to pay immediately.
Why you got it
The balance has stayed open through the earlier notices with no payment, plan or response the IRS has recorded. Sometimes the earlier letters went to an old address. Sometimes a plan was requested but never set up. Occasionally the balance itself is wrong because a payment was misapplied, and the CP504 is the first letter the person actually opens.
What the IRS says it can do
- Levy any state tax refund you are entitled to. If a balance remains after that, you may receive a notice giving you a right to a hearing before the Independent Office of Appeals
- Later levy wages and other income, bank accounts, business assets, personal assets including a car or home, and Social Security benefits
- File a notice of federal tax lien if it has not already, which can make it hard to sell or borrow against property
- Where the debt is seriously delinquent, report it to the State Department, which generally cannot issue or renew a passport while it stands
Wages and bank accounts generally come after a separate final notice with formal hearing rights, the LT11 or CP90. The CP504 is the warning that this is where the account is heading.
What to do now
- Do not set the letter aside. Read the balance and compare it with your records
- If you can pay in full, pay online or mail a payment with the bottom portion of the notice
- If you cannot pay in full, pay what you can and contact the IRS right away about a payment plan, by the phone number on the notice or through the Online Payment Agreement tool
- If you already paid or set up a plan, call anyway so the IRS confirms your account shows it
- If you think the collection is wrong, the notice explains how to request a Collection Appeals Program review before collection action begins
Getting on an agreed plan is what usually stops levy action on the account. Payment plan options explains the Simple Payment Plan and the alternatives.
How we help
At this stage the first job is to confirm the balance and get every required return filed, because the IRS generally will not agree to a plan while returns are missing. We pull transcripts, prepare any past-due returns or amended returns, and organize the income and expense records a plan request may need.
Representation before the IRS, including any appeal, is handled by the independent licensed CPA we work with, with our office coordinating. See tax resolution and what a wage garnishment involves.
What to send us
- A photo or scan of every page of the CP504 and any earlier notices, through the client portal
- The return for each year listed on the notice, and a list of any years you have not filed
- Records of payments made toward the balance
- Recent pay stubs and bank statements, if a payment plan is likely
Frequently asked questions
Can the IRS take my paycheck after a CP504?
The CP504 lets the IRS levy a state tax refund and warns that wages, bank accounts and other property can be levied later. Before levying wages or bank accounts the IRS generally sends a final notice of intent to levy that carries Collection Due Process hearing rights, the LT11, Letter 1058 or CP90. Paying or getting on an agreed plan now is what keeps it from reaching that point.
Will the IRS take my state tax refund?
It can. The IRS says it can seize any state tax refund you are entitled to after a CP504. If a balance still remains, you may then receive a notice giving you the right to a hearing before the IRS Independent Office of Appeals. Setting up a payment plan does not always stop an offset already in process, so act on the notice as soon as it arrives.
Can a CP504 affect my passport?
Yes, if the debt becomes seriously delinquent. Federal law generally bars the State Department from issuing or renewing a passport for someone with seriously delinquent tax debt that the IRS has reported to it. Paying the balance or entering an agreed payment plan generally takes the debt out of that category. IRS.gov/passports has the IRS explanation.
Is it too late for a payment plan once I get a CP504?
No. You can still pay what you can and apply for a payment plan by phone or online. The IRS generally requires all required returns to be filed first, so if any years are missing they need to be prepared at the same time. Back tax filing covers how missing years are handled.
Not the question you had? The full tax FAQ covers more ground, and our client reviews say what the work is actually like.
Related pages
CP503 notice
The second reminder. The last letter before the intent-to-levy notice, so the one to act on.
Learn moreLT11 / CP90 final notice
The final notice before levy, with a Collection Due Process hearing right that runs from the letter date.
Learn moreIRS payment plan options
The Simple Payment Plan, other installment agreements, short-term plans, hardship status and offers.
Learn moreCP14 notice
The first bill for a balance due. How to check the figure and pay or set up a plan by the date on the notice.
Learn moreHow to respond to an IRS letter
Check it, decide whether you agree, gather support, reply by the date, and keep proof.
Learn morePart of IRS & SC Letter Help. Not sure which service fits? Answer a few questions.
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