CP156 Notice: What It Means When You Owe the IRS
Summary:
The CP156 Notice is an IRS communication regarding a taxpayer’s balance on their tax account, often indicating payment discrepancies, missed payments, or issues with credit on the account. The notice explains the reason for the balance, which may include penalties and interest, and outlines the steps to address the balance. Resolving the issues promptly is important to avoid further penalties and interest accrual, and to ensure that the taxpayer’s account remains in good standing.
Receiving a CP156 Notice from the IRS can be unsettling, especially when it indicates an outstanding balance on your tax account. This notice usually means that there are payment discrepancies, missed payments, or adjustments to your account that resulted in a balance owed. It’s important to address the notice immediately to prevent further penalties, interest, or collection actions. This article explains everything you need to know about the CP156 Notice, including why it’s issued, how to resolve any balance, and the steps you should take to keep your account in good standing.
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What is the CP156 notice?
The CP156 Notice is sent by the IRS when there is a balance on a taxpayer’s account, usually due to payment discrepancies, missed payments, or issues with applied credits. The notice provides details about the balance, including the amount owed and any penalties or interest that may have accrued. This communication is often a result of changes in your account balance due to adjustments or corrections made by the IRS, such as correcting a filing error or applying payments to the wrong period.
The primary purpose of the CP156 Notice is to inform taxpayers of their outstanding balance and prompt them to take action to resolve it. Ignoring the notice could lead to further complications, such as additional penalties, interest accrual, or enforcement actions by the IRS, including wage garnishments or liens.
How the CP156 notice affects you
If you receive a CP156 Notice, it’s crucial to understand how it impacts your tax situation. The notice indicates that there is an outstanding balance on your tax account, and this balance could include unpaid taxes, penalties, and interest. If the balance is not addressed promptly, additional interest and penalties may accrue, increasing the total amount owed. In some cases, the notice may also indicate that a previous payment was not applied correctly or that credits were reversed, causing the balance to appear on your account.
Ignoring a CP156 Notice can lead to significant consequences, including the possibility of enforced collection actions by the IRS. These actions may involve placing a lien on your property, garnishing wages, or seizing assets. Therefore, it is important to respond to the notice quickly and take the necessary steps to resolve the issue.
Pro tip
Always keep records of your tax payments and any correspondence with the IRS. This documentation can be crucial if you need to dispute a balance or appeal a decision.
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Steps to take when you receive a CP156 notice
Upon receiving a CP156 Notice, follow these steps to address the issue:
- Read the notice carefully to understand the reason for the balance on your account and any associated penalties or interest.
- Verify your tax records to ensure that the information on the notice matches your records. Look for discrepancies in payments, credits, or any recent tax return adjustments.
- If you disagree with the balance, contact the IRS immediately to discuss the notice and request a correction or additional information. The contact information will be listed on the notice.
- If you agree with the balance, make arrangements to pay the amount owed as soon as possible. You can pay online through the IRS website, by phone, or by mail using a check or money order.
- Consider setting up a payment plan with the IRS if you are unable to pay the full amount immediately. The IRS offers various payment options, including installment agreements and short-term payment plans.
How to resolve the balance on your account
Paying the balance in full
The simplest way to resolve a CP156 Notice is to pay the balance in full. This can be done online through the IRS’s payment portal, by phone, or by sending a check or money order to the address provided in the notice. When paying by mail, be sure to include the payment voucher from the notice and your account number.
Setting up a payment plan
If you are unable to pay the full amount immediately, you can set up a payment plan with the IRS. This may involve a short-term payment arrangement or a longer-term installment agreement, depending on the amount owed and your financial situation. To apply for a payment plan, you can visit the IRS website or contact the number listed on the notice for assistance.
Disputing the balance
If you believe that the balance is incorrect, you have the right to dispute it. Contact the IRS using the information provided in the notice and provide any relevant documentation that supports your claim. This could include proof of payment, copies of your tax returns, or correspondence with the IRS regarding previous adjustments.
Pro tip
If you’re setting up a payment plan, opt for automatic debit payments to ensure timely payments and avoid additional penalties or interest for late payments.
Other ways to handle a CP156 notice
In addition to the steps outlined above, there are other actions you can take to manage a CP156 Notice:
- Consult a tax professional if you are unsure how to proceed. A CPA or tax attorney can help you understand the notice and represent you in dealings with the IRS.
- Check your online IRS account to view your current balance and payment history. This can help you confirm the details in the CP156 Notice.
- Consider filing a request for an abatement of penalties if you believe you have a valid reason for not being able to pay the balance on time, such as a serious illness or natural disaster.
Potential penalties or next steps if you don’t respond
Failure to respond to a CP156 Notice can have serious consequences:
- Additional penalties and interest may continue to accrue on the balance owed, increasing the total amount due.
- The IRS may take enforcement actions such as filing a tax lien, garnishing wages, or seizing assets to collect the debt.
- Unresolved issues may affect future tax refunds, as the IRS may offset any refunds you are owed to cover the outstanding balance.
To avoid these penalties, respond to the notice and take the necessary steps to resolve the balance as soon as possible.
Pro tip
Consult a tax professional before agreeing to a payment plan if you have substantial tax debt. They may help you explore options like an Offer in Compromise or other relief programs.
What potential outcomes are possible?
Once you respond to a CP156 Notice, the following outcomes are possible:
- If you pay the balance in full: Your account will be brought up to date, and no further action will be necessary.
- If you set up a payment plan: The IRS will continue to monitor your account and expect timely payments based on the agreement.
- If you dispute the balance and the IRS agrees: Your account may be adjusted, reducing or eliminating the amount owed.
- If you dispute the balance and the IRS disagrees: You may be required to pay the remaining balance, potentially with additional penalties or interest.
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Frequently asked questions
How can I check the current balance on my IRS account?
You can check the current balance on your IRS account by visiting the IRS website and accessing your online account. You will need to create an account or log in with your existing credentials. The online portal will provide a detailed view of your current balance, payment history, and any notices sent to you. Alternatively, you can contact the IRS directly using the phone number provided on your CP156 Notice.
What payment methods does the IRS accept for settling a CP156 notice?
The IRS accepts several payment methods for settling balances related to a CP156 Notice. These include online payments via the IRS Direct Pay system, electronic funds withdrawal, credit or debit card payments, and checks or money orders sent by mail. If paying by mail, make sure to include the payment voucher from your CP156 Notice. For installment agreements, automatic debit payments can also be arranged.
Can I appeal a decision made by the IRS regarding my CP156 notice?
Yes, if you disagree with the IRS’s decision or the balance stated in the CP156 Notice, you have the right to appeal. The first step is to contact the IRS to discuss your disagreement. If the issue is not resolved, you can formally request an appeal through the IRS’s Office of Appeals. You may need to provide supporting documents and a written explanation of why you believe the IRS’s decision is incorrect.
Will a CP156 notice affect my credit score?
A CP156 Notice itself will not directly affect your credit score, as the IRS does not report tax debts to credit bureaus. However, if the balance remains unpaid and the IRS files a federal tax lien against your property, it could appear on your credit report and negatively impact your score. It’s important to resolve any outstanding balances quickly to avoid such consequences.
Can I seek assistance from a taxpayer advocate for a CP156 notice?
Yes, you can seek assistance from the Taxpayer Advocate Service (TAS), an independent organization within the IRS that helps taxpayers resolve issues. If you are facing financial hardship or are struggling to resolve the problem with your CP156 Notice through normal channels, the TAS may be able to assist you. Contact the Taxpayer Advocate Service through their website or by calling their toll-free number for more information.
Need help understanding other IRS letters and notices? Visit our comprehensive guide to IRS Letters and Notices or search for the document you received in the table below.
| CP01 | The IRS verified your claim of identity theft and will monitor your account. |
| CP01H | The IRS received a tax return with a social security number that belongs to a dead person. |
| CP02H | Money is due on an amended return based on a grant received due to Hurricane Katrina, Rita, or Wilma. |
| CP03C | You received the First-Time Homebuyer Credit for a house you purchased. |
| CP04 | You may be eligible for tax deferment because either you or a spouse served in a combat zone, a qualified contingency operation, or a hazardous duty station during the tax year specified on your notice. |
| CP08 | You may be entitled to additional money due to the Additional Child Tax Credit. |
| CP10 | Your tax return changed due to a miscalculation, and the refund you wanted to apply to an estimated tax payment has changed. |
| CP10A | Your tax return changed due to a miscalculation of the Earned Income Credit, and the refund you wanted to apply to an estimated tax payment has changed. |
| CP11 | You owe money because the IRS amended your return due to a miscalculation. |
| CP11A | Your tax return changed due to a miscalculation of the Earned Income Credit, and the refund you wanted to apply to an estimated tax payment also changed. |
| CP11M | Your tax return changed due to a miscalculation of the Making Work Pay and Government Retiree Credit, and the refund you wanted to apply to an estimated tax payment has changed. |
| CP12 | You are due a bigger refund because the IRS corrected one or more mistakes on your tax return. |
| CP12A | The IRS made changes to correct the Earned Income Credit (EIC) claimed on your tax return. |
| CP12E or CP12F | The IRS corrected a miscalculation on your return. |
| CP12M | The IRS made changes to the computation of the Making Work Pay and/or Government Retiree Credits on your return. |
| CP12R | The IRS made changes to the computation of the Rebate Recovery Credit on your return. |
| CP13 | The IRS made changes to your return due to a miscalculation. There is no refund or amount due. Your balance is zero. |
| CP13A | The IRS made changes to your return due to a miscalculation of the Earned Income Credit. There is no refund or amount due. Your balance is zero. |
| CP13M | The IRS made changes to your return due to a miscalculation of the Making Work Pay credit or the Government Retiree Credit. There is no refund or amount due. Your balance is zero. |
| CP13R | The IRS made changes to your return due to a miscalculation of the Recovery Rebate Credit. There is no refund or amount due. Your balance is zero. |
| CP14 | You owe money on unpaid taxes. |
| CP16 | The IRS made changes to your return due to a miscalculation. The refund you were due was applied to other tax debts. |
| CP21A | You owe money due to the changes you requested that the IRS make on your tax returns. |
| CP21B | You are due a refund due to the changes you requested that the IRS make on your tax returns. The money should arrive within 2 to 3 weeks. |
| CP21C | The IRS made the requested changes to your tax return. You will not receive a refund, and there is no tax due. Your balance is zero. |
| CP21E | As a result of your recent audit, the IRS made changes to your tax return, and you owe money as a result of those changes. |
| CP21I | The IRS made changes to your tax return relating to the Individual Retirement Arrangement (IRA) taxes. You owe money due to the changes. |
| CP22A | The IRS made the changes you requested, and you owe money as a result. |
| CP22E | As a result of your recent audit, the IRS changed your tax return, and you now owe money. |
| CP22I | The IRS made changes to your tax return relating to the Individual Retirement Arrangement (IRA) taxes. You owe money due to the changes. |
| CP23 | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. You owe taxes due to these changes. |
| CP24 | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. This resulted in an overpayment of estimated taxes. |
| CP24E | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. This resulted in an overpayment of estimated taxes. |
| CP25 | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. You are not due a refund, nor do you owe any money. Your balance is zero. |
| CP31 | You need to update your address because your refund check was returned to the IRS. |
| CP45 | The IRS was unable to apply your overpayment to your estimated tax as you requested. |
| CP49 | The IRS used all or part of your refund to pay a tax debt. |
| CP53 | Your refund check will be sent by mail because the IRS can’t provide your refund through direct deposit. |
| CP57 | The bank declined your payment, so the IRS was unable to draft funds from your bank account. |
| CP71 | A reminder of the amount you owe in tax, penalty, and interest. |
| CP71A | A reminder of the amount you owe in tax, penalty, and interest. |
| CP71C | A reminder of the amount you owe in tax, penalty, and interest. |
| CP71D | A reminder of the amount you owe in tax, penalty, and interest. |
| CP88 | The IRS is holding your refund because you haven't filed one or more tax returns, and it believes you will owe tax. |
| CP90 | The IRS is notifying you of its intent to levy certain assets for unpaid taxes. You have the right to dispute the levy in a Collection Due Process hearing. |
| CP91 | The IRS will levy up to 15% of your social security benefits for unpaid taxes. |
| CP120 | The IRS needs documentation of your tax-exempt status. |
| CP120A | Your organization’s tax-exempt status has been revoked because it failed to file a Form 990 series return for three consecutive years. |
| CP130 | You may no longer need to pay the Alternative Minimum Tax (AMT) because your tax return filing requirements changed. |
| CP152 | The IRS received your return. |
| CP153 | The IRS will send your refund by mail because your direct deposit did not go through. |
| CP161 | You have an unpaid balance due to the IRS. |
| CP166 | Your monthly payment to the IRS did not go through due to insufficient funds in your bank account. |
| CP178 | You may no longer owe excise tax because your tax return filing requirements changed. |
| CP231 | You need to update your address because your refund was returned to the IRS. |
| CP259 | You did not file the business tax return identified in the notice. |
| CP259A | You should have filed these forms but did not – Form 990/990-EZ, Return of Organization Exempt From Income Tax, or Form 990-N (e-Postcard). |
| CP259B | The IRS requires you to file these forms but did not – Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation. |
| CP259C | The IRS believes that you are a private foundation, but did not file the required Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation. |
| CP259D | You must file this form, but you did not – Form 990-T, Exempt Organization Business Income Tax Return. |
| CP259E | You should have filed this form, but you did not – Form 990-N (e-Postcard) or Form 990/990-EZ, Return of Organization Exempt From Income Tax. |
| CP259F | The IRS requires you to file this form but did not – Form 5227, Split-Interest Trust Information Return. |
| CP259G | The IRS requires you to file this form, but you didn’t – Form 1120-POL, U.S. Income Tax Return for Certain Political Organizations. |
| CP259H | As a tax-exempt political organization, you must file this form, but you did not – Form 990/990-EZ, Return of Organization Exempt From Income Tax. |
| CP276A | You submitted your tax liability schedule incorrectly. The IRS typically charges a Federal Tax Deposit (FTD) penalty for this but did not this time. |
| CP276B | The IRS did not receive the correct amount of tax deposits. It normally charges a Federal Tax Deposit (FTD) penalty but did not this time. |
| CP297 | The IRS is notifying you of its intent to levy certain assets for unpaid taxes. You have the right to dispute the levy at a Collection Due Process hearing. |
| CP297A | The IRS has levied your assets for unpaid taxes. You have the right to dispute the levy at a Collection Due Process hearing. |
| CP298 | The IRS notifying you of its intent to levy up to 15% of your social security benefits for unpaid taxes. |
| CP501 | You have a balance due on one of your tax accounts. |
| CP503 | You have an unpaid balance on one of your accounts, and the IRS has not heard from you. |
| CP504 | You have an unpaid amount due on your account. If you do not pay immediately, the IRS will levy your state income tax refund to apply it to the amount you owe. |
| CP504B | You have an unpaid amount due on your account. If you do not pay immediately, the IRS will levy certain property or rights to property to apply it to the amount you owe. |
| CP521 | A reminder that you have an installment agreement payment due. |
| CP523 | You have defaulted on your payment agreement. Therefore the IRS is terminating the agreement and will levy your assets. |
| CP601 | Usted tiene un saldo pendiente de pago (dinero que le debe al IRS) en una de sus cuentas contributivas. |
| CP603 | No hemos recibido respuesta de parte de usted y todavía tiene un saldo sin pagar en una de sus cuentas contributivas. |
| CP604 | Usted tiene un saldo sin pagar en su cuenta. De no pagar esta cantidad inmediatemente, el IRS embargará cualquier reembolso de impuestos estatales al que tenga derecho y aplicarlo al pago de su deuda. |
| CP604B | Usted tiene un saldo sin pagar en su cuenta. De no pagar esta cantidad inmediatemente, el IRS embargará ciertas propiedades o derechos de propiedad y lo aplicará al pago de su deuda. |
| CP621 | Este aviso es para notificarle que usted tiene un plan de pagos a plazos vencido. Por favor, envíe el pago inmediatamente. |
| CP623 | Este aviso es para informarle nuestra intención de cancelar su plan de pagos a plazos y confiscar (embargar) sus bienes. Usted incumplió en su acuerdo. |
| CP711 | Nosotros realizamos cambios a su planilla debido a que entendemos que hubo un cálculo erróneo. Como resultado de estos cambios, usted adeuda dinero por sus contribuciones. |
| CP721 | Hicimos el(los) cambio(s) que usted solicitó a su declaración de impuestos para el año tributario que aparece en su aviso. Como resultado de éste(estos) cambio(s) usted debe dinero en sus impuestos. |
| CP722 | Hicimos el(los) cambio(s) que usted solicitó a su declaración de impuestos para el año tributario que aparece en su aviso. Como resultado de éste(estos) cambio(s) usted debe dinero en sus impuestos. |
| CP771 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP772 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP773 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP774 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP959 | Usted no radicó su planilla de contribución de negocios identificada en este aviso. |
| CP2000 | The income or payment information on file doesn’t match your tax return. The discrepancy may result in an increase or decrease in your tax due. |
| CP3219A | The IRS has received information that is different from what you reported on your tax return. This may result in an increase or decrease in your tax. |
| CP3219N | The IRS didn’t receive your tax return, so it calculated your return based on the information received from employers, financial institutions, and others. If you want to challenge the proposed tax, you have 90 days from the date of this notice. If you are outside the country, you have 150 days. |
| Letter 0012C | The IRS needs additional information to process your tax return. |
| Letter 0484C | The IRS wants a completed |
| Letter 0525 | Updates you on proposed changes after an IRS examination. Any changes are explained and details the refund due or taxes owed. |
| Letter 531 | IRS Notice of Deficiency. The information the IRS received about you was different from what you reported on your return. |
| Letter 0668D(LP 68) | The IRS released their levy. |
| Letter 0549C | Your tax bill was paid. |
| Letter 0681C | The IRS accepted your payment proposal. However, this is not a formal Installment Agreement. |
| Letter 0757C | You did not adhere to the terms of your Installment Agreement. |
| Letter LT 11 | The IRS plans to seize your property or rights to property. |
| Letter 1058 | The IRS has not received your payment. It plans to seize your property or rights to property. |
| Letter 1615 (LT 18) | You must respond to the IRS within 10 days of this notice regarding past due tax returns. |
| Letter 1737 (LT 27) | Complete and sign Form 433F, Collection Information Statement. |
| Letter 1961C | Your application for a Direct Debit Installment Agreement was declined. It explains why and what you need to do to qualify. |
| Letter 1962C | Your application for a |
| Letter 2050 (LT 16) | The IRS is trying to collect unpaid taxes from you from returns that have been filed or from returns that have not been filed. |
| Letter 2257C | The IRS is providing the payoff amount that you requested. |
| Letter 226-J | An IRS letter to large employers notifying them that they may be liable for an Employer Shared Responsibility Payment (ESRP). |
| Letter 2271C | A request for an Installment Agreement has been approved. It explains the fees and how to qualify for a Low Income Fee Reduction. The letter may also request missing information. |
| Letter 2272C | An IRS letter explaining why your request to pay the balance due in installments was declined. |
| Letter 2273C | A confirmation letter of your request to pay the balance due in installments. It contained the amount to pay, fees charged, and where to send payment. Instructions on how to apply for the Low Income Fee Reduction included. |
| Letter 2318C | A response to a request to pay taxes due to payroll deductions. It also explains the fees that are charged. |
| Letter 2357C | The IRS is admitting that it did not send you the balance due notices that it should have. |
| Letter 2603C | The IRS accepted your installment agreement. The IRS will file a Notice of Federal Tax Lien on your personal property. |
| Letter 2604C | The IRS has accepted your request for installment payments. This IRS letter provides the monthly payment, the address where to send it, and the fees charged. The letter also provides instructions on how to apply for the Low Income Fee Reduction. |
| Letter 2761C | The IRS is requesting your combat zone service dates to ensure that it provides you with the special provisions and protection of the combat zone deferment. Copies of military orders or other documentation to support your time served may be requested. Civilians working in support of the Armed Forces may be required to provide a Letter of Authorization or a letter from their employer. |
| Letter 2789C | An annual reminder notice, as required by law, of the balance due to the IRS. It explains that penalties and interest continue to accrue until the balance is fully paid. |
| Letter 2840C | Confirms your Installment Agreement request and includes the payment amount and due date. This IRS letter explains the fees charged for paying monthly and explains how to apply for the Low Income Fee Reduction (if you qualify). |
| Letter 3030C | Provides an explanation of the tax, penalty, and interest still due on your account. |
| Letter 3127C | A confirmation of your request to make a change to your Installment Agreement. This IRS letter explains the fees for the change. Changes can be to the payment amount or due date, or it can include additional liabilities. |
| Letter 3174 | A reminder of taxes due after the IRS has sent a Notice of Intent to Levy. |
| Letter 3217C | The IRS has accepted your request to pay the balance in installments. This IRS letter provides your payment amount, the due date, and fees charged. The letter also provides instructions on applying for the Low Income Fee Reduction (if you qualify). |
| Letter 3228 (LT 39) | A request to pay the balance due within 10 days using the envelope provided. |
| Letter 3500 | The IRS has received your documents, and it needs additional time to review them. |
| Letter 3572 | Your Federal Income Tax Return has been selected for examination. The IRS auditor requests that you call to schedule an audit appointment. |
| Letter 4883C | The IRS received your federal income tax return but needs more information to verify your identity in order to process your tax return accurately. |
| Letter 4903 (LT 26) | You must file your tax returns immediately. The IRS has previously contacted you, but it did not receive a response. |
| Letter LP 47 | The IRS is trying to locate the person identified in the letter and is requesting that you provide their new address. |
| Letter LP 59 | The IRS has not received a response to the notice of levy it previously sent. |
| Audit Letter 2205 | The IRS manages audits either by mail or through an in-person interview to review your records. The interview may be at an IRS office (office audit) or the taxpayer’s home, place of business, or accountant’s office (field audit). |
| Letter 915 | You recently underwent an audit, and the IRS informs you that you now owe taxes. |
Key takeaways
- The CP156 Notice is issued when there is a balance on your IRS tax account.
- It is important to respond promptly to avoid further penalties and interest accrual.
- Consider paying the balance in full, setting up a payment plan, or disputing the balance if you believe it is incorrect.
- Ignoring the notice can result in enforcement actions, such as wage garnishments or tax liens.
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