Inside Scoop: The IRS CP523 Letter

David Playford/freeimages
David Playford/freeimages

You’re chipping away at your IRS Installment Agreement payments faithfully. Then the car breaks down and needs several hundred dollars in repairs. Shortly afterward, you get hit with the co-pay for your kid’s late-night ER visit. Your work hours suddenly get cut.

These things happen. Unfortunately, the IRS wants their money…now.

Here’s what can happen if you fall behind on your installment agreement, and fail to contact the IRS.

The CP523 Letter

The language of the CP523 letter is no joke. It informs you that unless you pay the full amount due (so much for the installment agreement), you run the risk of either a tax lien, asset seizure or both.

A good thing to keep in mind is this: the IRS issues the letter after you’ve missed several installment payments. If you miss one or two, you still might have a chance to salvage the installment agreement.

The IRS issues the CP523 when you haven’t contacted them to advise them of your change in circumstances. They assume you’re skipping out on the debt and they want to recover that debt…quickly.

If You Fall Behind…

Contact the IRS immediately. Don’t wait for the CP523 to land in your mailbox. By being proactive, you are demonstrating to Uncle Sam that you want to keep up with your installment payments.

If the thought of dealing with the IRS intimidates you, think about hiring a tax advisor. They deal with the IRS for a living and are able to effectively communicate with them on your behalf.

If You Get The Letter

At this stage you’ve missed several payments and have not contacted the IRS. The chances of salvaging your installment agreement are slim, but you should put forth the effort and contact the IRS at the phone number printed on the letter.

The IRS will give you 30 days to respond to the letter. Don’t wait 30 days to contact them. Do it now.

At this stage, you’ll need a good tax pro. They can negotiate with the IRS on your behalf, help you sort out your finances, and help you determine your next steps. If you’ve reached this point the IRS isn’t interested in playing nicely, so you’ll need someone on your side to represent you and to inform you of your rights…and to make sure the IRS respects those rights.

Falling behind on installment agreement payments can happen to anyone. Costly emergencies happen which can drain your finances and divert funds away from your installment payments.

If you receive the IRS CP523 letter, it’s important for you to take action right away in order to avoid getting hit with a tax lien or asset seizure. A qualified tax pro can help you sort out your options and to understand your rights.

Need a tax pro? We can help. We have Enrolled Agents and tax attorneys on staff who specialize in situations such as yours. They can negotiate with the IRS on your behalf, assess your options, and walk you through the process of dealing with the IRS.

Get started today by clicking the white “Start Chat” button or by giving us a call. Don’t go it alone. We can help.

2 thoughts on “Inside Scoop: The IRS CP523 Letter”

  1. Another thing I’ve really noticed is that for many people, below-average credit is the response to circumstances above their control. As an example they may happen to be saddled by having an illness and as a consequence they have large bills for collections. Maybe it’s due to a job loss or inability to work. Sometimes divorce proceedings can send the financial circumstances in an opposite direction. Many thanks sharing your thinking on this weblog.

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