What is a CP14 Notice?
Receiving a notice from the IRS can be extremely stressful. However, receiving a CP14 Notice can be particularly taxing as it indicates you owe money to the IRS.
The CP14 Notice informs a taxpayer that there is an overdue unpaid balance of taxes to the IRS. In addition, it outlines the fees and penalties assessed for failing to pay a tax balance on time.
As with receiving any notice from the IRS, it’s essential to take action before the due date listed on the CP14. This article examines what a CP14 notice means and your options moving forward.
Why am I Getting a CP14 Notice?
The CP14 Notice is an initial notice letting you know that you owe unpaid taxes, penalties, and/or interest to the IRS. It is an automated notice that goes out to anyone with an unpaid tax balance.
The Notice contains:
- Billing summary of the money owed to the IRS
- Due date of the balance owed
- Payment options (including what to do if you can’t pay the balance in full)
- Consequences for ignoring the Notice
You have 21 days from the notice date to respond to the Notice or pay the balance. Note that the notice date may be different from the date that you receive the Notice.
What Should I Do If I Receive a CP14 Notice?
When you first receive a CP14 notice in the mail, you should review the contents of the Notice in detail. Pay special attention to the amount owed and the due date of the balance owed.
The actions you should take following the receipt of a CP14 notice depend on the accuracy of the Notice and your financial situation. However, the key is that you take some sort of action. Ignoring the Notice will only worsen the situation, and the IRS can take serious action to collect outstanding debt. Let’s look at the next steps you should take depending on the abovementioned factors.
What if My CP14 Notice is Inaccurate?
The CP14 Notice is an automated notice from the IRS if you have an outstanding unpaid balance. The automated system does make mistakes, so it’s important to look over your tax return and see if you actually should owe money.
While you have a copy of your tax return out, you should also check to see if you missed any deductions or credits that may be able to cover the balance owed. If you find a deduction or credit you overlooked, you should file an amended tax return.
If you plan to file an amended tax return, you should notify the IRS of your intentions and file the amended return before the balance due date listed on the CP14.
What If I Can’t Pay the Balance Due on My CP14?
If you can’t pay the balance due on your CP14 by the due date, you should contact us to discuss your best option. You must reach out as soon as possible so that you can contact the IRS prior to your payment due date. In general, you have three options to either delay the payment or work with the IRS to reduce the amount owed.
- Request an extension. If you need some extra time to collect the balance owed, you can call the IRS and ask for up to an additional 120 days to pay. At the end of the 120 days, you must pay the entire balance in full.
- Reduce or erase the penalty. If this is the first time you’ve been assessed a failure-to-pay penalty in the past three years, you can request a first-time penalty abatement. If you call the IRS directly, they may waive the penalty, given that you can pay the taxes owed. If this is not your first time, it’s best to work with an IRS Shield tax expert to asses other potential avenues for removing the penalty.
- Work out an agreement with the IRS. If you truly can’t pay the balance within 120 days, you should not just ignore the Notice. The IRS offers several tax debt relief options so they can collect at least part of the balance. Some more common solutions include installment agreements or an offer in compromise.
Should I Ask for Help If I Get a CP14 Notice?
If you receive a CP14 notice, it’s best to contact us before paying or responding to the Notice. The IRS does make mistakes, so it’s essential to have your tax return reviewed by a professional to ensure that you do owe taxes to the IRS.
In addition, there are several ways to reduce the amount owed to the IRS. For example, if this is your first time with an overdue balance, you can have the IRS waive your failure-to-pay penalty. Reaching out to IRS shield helps you pay the IRS less and gives you the comfort of having experienced individuals who know what they are doing and walk you through your next options.