Updated September 7, 2026. For the other letters in the balance-due sequence, see our guide to IRS notices.
The short answer: a CP504 is the IRS’s Notice of Intent to Levy under Internal Revenue Code section 6331(d). It means you have an unpaid balance, earlier notices went unanswered, and if you do not pay or make arrangements by the date on the notice — 30 days from the notice date — the IRS can seize your state tax refund and may file a federal tax lien. It is more serious than the reminders before it, but it is not yet the letter that lets the IRS take your wages, bank account or property; that comes next, with appeal rights attached. The right response is to act inside the 30 days: pay, set up a plan, or dispute the balance, so the case never reaches the next stage.
Where CP504 sits in the sequence
For an individual with a balance due, the IRS notices usually arrive in this order: CP14 (first bill), CP501 (reminder), CP503 (second reminder), CP504 (Notice of Intent to Levy), then LT11 or Letter 1058 (Final Notice of Intent to Levy and Notice of Your Right to a Hearing). Businesses get the same sequence with a CP504B. Each letter carries a date and a balance that has grown with penalties and interest since the last one.
The IRS itself calls CP504 a “final reminder,” and the Taxpayer Advocate Service notes it is sometimes referred to as a final notice. That wording confuses people. Read the notice literally: it is the final reminder before the IRS moves to enforcement, and the one enforcement step it authorizes on its own is described below.
What “intent to levy” means at this stage
A levy is the seizure of property or a right to property to satisfy a tax debt. CP504 announces the intent to levy, and the notice states that if the amount is not received within 30 days of the notice date, the IRS can levy your state tax refund. That is the concrete, immediate consequence: your next state refund can be taken and applied to the federal balance.
For most other property — wages, bank accounts, business receivables, vehicles, real estate, Social Security benefits — the notice says that the IRS will first send you a notice giving you the opportunity to request a Collection Due Process hearing. That is the LT11 or Letter 1058. So CP504 is the warning; the LT11 is the trigger. Our guide to the LT11 and Letter 1058 covers the 30-day Collection Due Process deadline and Form 12153 in detail.
Two other consequences are on the table at the CP504 stage. The IRS can file a Notice of Federal Tax Lien if it has not already, which is a public record that attaches to everything you own. And CP504 explains that a “seriously delinquent tax debt” — more than $66,000 in 2026 with a lien filed or a levy issued — can be certified to the State Department, which then generally will not issue or renew a passport.
The deadline on your notice
Use the date printed on your CP504, not a date from an article. The notice gives a “pay by” date 30 days from the notice date. If mail was delayed, you may already be inside that window when you open it. If the date has passed, the IRS may not have acted yet, and responding late is still far better than not responding; but do not assume there is time left.
What happens if you ignore it
- Your state tax refund can be levied.
- A Notice of Federal Tax Lien may be filed.
- The failure-to-pay penalty rises from 0.5% to 1% per month if the balance is not paid within 10 days of a notice of intent to levy, and interest — currently 7% per year for individuals — keeps compounding daily.
- The next letter is LT11 or Letter 1058. From its date you have 30 days to request a Collection Due Process hearing on Form 12153. If you do not, the IRS can levy wages, bank accounts and other property without further notice, and you lose the right to take the underlying dispute to the Tax Court.
- If the balance crosses the seriously-delinquent threshold, passport certification can follow.
How to respond
There are four responses, and the right one depends on whether the balance is correct and whether you can pay it.
1. Pay in full. IRS Direct Pay or a debit/credit card through the options on the notice. Paying stops the levy, stops further penalties, and removes the lien question.
2. Set up a payment plan. If you cannot pay in full, apply online for a short-term plan (up to 180 days, balances under $100,000) or a monthly installment agreement (balances up to $50,000 online, including the new Simple Payment Plan). An approved plan stops levy action and drops the failure-to-pay rate to 0.25% per month. You must have filed all required returns first. The options and fees are compared in our guide to IRS payment plans.
3. Dispute the balance. If the amount is wrong — a payment was not credited, a return was amended, the year was assessed on a substitute return — call the number on the notice with your documentation, and consider a Collection Appeals Program request, which the notice offers as an option at this stage. If the balance comes from a year you never filed, filing an accurate return usually reduces it; see unfiled tax returns.
4. Ask for a hold. If you cannot pay anything without hardship, the IRS can place the account in currently-not-collectible status after reviewing a financial statement. Penalties and interest continue, but levy action stops.
Whichever you choose, do it before the date on the notice and keep the confirmation. A payment plan requested online generates immediate confirmation; a phone call should be logged with the date, time and representative ID.
CP504 for businesses (CP504B)
The business version works the same way, usually for unpaid payroll taxes or a corporate income tax balance. The IRS notes that the state refund levy program currently applies to individual refunds, so the immediate consequence for a business is the lien and the move toward LT11. Payroll balances are treated more seriously because withheld taxes are trust-fund money, and the IRS can pursue owners and officers personally for them; a CP504B for payroll tax is a reason to get current on deposits and onto a plan immediately.
When professional representation helps
A CP504 for a balance you agree with and can pay or put on a small plan is something you can handle in an afternoon. Representation makes sense when the balance is large or spans several years, when the amount is wrong and needs to be reconstructed, when unfiled years sit behind the balance, when a lien would damage a business or a pending loan, when the balance is payroll tax, or when the LT11 has already arrived and the 30-day hearing clock is running. With a signed Form 2848 we deal with the IRS directly, get the account transcripts, set up the plan or the appeal, and request penalty relief where the history supports it. Our IRS resolution service is scoped and priced per matter before we start.
Common questions
Is CP504 the final notice before the IRS takes my bank account?
No. CP504 lets the IRS levy your state tax refund and file a lien. Bank accounts, wages and other property generally require the LT11 or Letter 1058 first, which gives you the right to a Collection Due Process hearing.
Can I still set up a payment plan after a CP504?
Yes, and doing so stops the levy process. All required returns must be filed first.
Will a CP504 affect my credit?
The notice itself is not reported to credit bureaus. A Notice of Federal Tax Lien is a public record that lenders can find, which is one reason to resolve the CP504 before a lien is filed.
What if I already paid?
If you paid recently, the notice and the payment may have crossed. Check your account online; if the payment posted, no further action is needed. If it did not, call the number on the notice with proof of payment.
What if I never received the earlier notices?
The IRS mails to the last address on file. Update your address (Form 8822) and respond to the CP504 anyway; not receiving earlier letters does not pause the process.
Holding a CP504 right now? Send us the notice and we will tell you the same day whether to pay, plan or dispute — or get help with an IRS notice.
Sources
- IRS, Understanding your CP504 notice — irs.gov
- IRS, Understanding your CP504B notice — irs.gov
- IRS, Understanding your LT11 notice or Letter 1058 — irs.gov
- Taxpayer Advocate Service, Notice CP504 — taxpayeradvocate.irs.gov
- IRS, Revocation or denial of passport in cases of certain unpaid taxes — irs.gov
- IRS, Failure to pay penalty — irs.gov
- IRS, Payment plans; installment agreements — irs.gov
Questions about how this applies to your situation? We can talk it through and point you to the right next step.