Getting a letter from the IRS with the words "intent to levy" is alarming, and it should be taken seriously. It should also be understood accurately, because the right response depends on what this notice does and does not do.
What Notice CP504 is
According to the IRS, CP504 is a Notice of Intent to Levy under Internal Revenue Code section 6331(d). It is a reminder that you have an unpaid balance and that the IRS intends to collect it. The IRS warns it can levy wages, bank accounts, or your state tax refund, and may later seize other property. It may also file a Notice of Federal Tax Lien, and seriously delinquent tax debt can affect a passport.
What the IRS says to do
- 1Pay the full amount right away, online or by mailing payment with the bottom portion of the notice.
- 2If you cannot pay in full, pay what you can and call the toll-free number on the notice to ask about a payment plan.
- 3If you disagree with the amount, call the number on the notice.
- 4If you already paid or set up an installment agreement, call anyway to confirm your account reflects it.
- 5Read the notice for any appeal instructions, including the Collection Appeals Program.
The IRS does not state a fixed number of days on its explanatory page and tells you to act immediately, so use any date printed on your own notice as the working deadline.
Is CP504 the final notice before a levy?
Not necessarily. The IRS has separate notices that carry formal Collection Due Process hearing rights, and those typically come later. CP504 does allow a limited appeal through the Collection Appeals Program, and a state refund levy can trigger a hearing right through the IRS Independent Office of Appeals. Do not treat CP504 as harmless just because more notices may follow.
Check these things before you respond
- Is the balance accurate? Compare with your return and any prior notices.
- Are all required returns filed? Unfiled returns can block payment plans.
- Was a payment or agreement already made that the notice does not reflect?
- Are penalties included that you may qualify to have removed? See IRS penalty abatement.
If you cannot pay in full
Contact the IRS before collection action starts. A structured arrangement is much easier to set up before a levy than after. Read our guide to IRS payment plans for small business owners for how that process works.
If your notice involves a business balance, unfiled returns, or payroll taxes, our IRS resolution service can review it with you. You can also get help with your business tax situation. Every case differs, and results are not guaranteed.
