How to Respond to a CP259H Notice
Summary:
The CP259H Notice is sent by the IRS to tax-exempt political organizations when they fail to file a required Form 990 or Form 990-EZ. This form is a Return of Organization Exempt from Income Tax. The IRS notice is a formal reminder to comply with filing regulations. If the organization has filed the required forms recently, the notice can be disregarded. However, if the form hasn’t been filed or was submitted incorrectly, the organization must take prompt action to avoid penalties. This article explains how to respond to the notice, the steps you need to take, and what to expect moving forward.
Receiving a CP259H Notice from the IRS can cause alarm, especially if you’re unsure about your filing obligations. This notice is typically directed at tax-exempt political organizations that failed to submit a Form 990 or 990-EZ, which is required to maintain tax-exempt status. If you’ve already filed or believe you’re exempt from filing, resolving this situation quickly will help avoid penalties or compliance issues. In this guide, we will walk you through everything you need to know about the CP259H Notice, why you received it, and how to ensure your organization remains in good standing with the IRS.
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What is a CP259H notice?
The IRS sends a CP259H Notice to tax-exempt political organizations when their records indicate a failure to file the required Form 990 or 990-EZ. Form 990 is essential for tax-exempt entities because it provides the IRS with detailed information about the organization’s operations and financials. Political organizations that do not meet their filing obligations risk losing their tax-exempt status.
Understanding Form 990 and 990-EZ
Form 990 is an annual information return required by the IRS for tax-exempt organizations. For smaller organizations, Form 990-EZ may be an option if certain financial thresholds are met. These forms help the IRS ensure that tax-exempt organizations continue to meet the necessary requirements to retain their status. Failure to file can result in penalties, loss of tax-exempt status, and other complications.
Pro Tip
Always double-check your EIN and organization name on any submitted forms to avoid discrepancies that could lead to a CP259H Notice.
Why you receive a CP259H notice
The notice is sent when the IRS does not have a record of your organization submitting a required Form 990 or 990-EZ. This could happen for a variety of reasons:
- You forgot to file the required form.
- The form was filed under a different EIN or organization name.
- There was a clerical or technical error that led to a missed filing.
If your organization falls under these circumstances, the CP259H Notice serves as an alert to address the issue before the situation escalates.
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How does the CP259H notice affect your organization?
The CP259H Notice can affect your organization in several ways, depending on your compliance history and how promptly you respond. If you take immediate steps to resolve the issue, there’s a good chance you can avoid any serious penalties. However, ignoring the notice or failing to address the underlying issue can lead to larger problems.
Potential penalties for non-compliance
If your organization does not respond to the CP259H Notice or fails to file the required forms in time, several consequences may arise:
- Monetary penalties: The IRS can impose fines based on the size of your organization and how long the form is overdue.
- Loss of tax-exempt status: Continued failure to file may result in the revocation of your organization’s tax-exempt status, making it liable for federal income taxes.
- Increased scrutiny: Non-compliance can attract unwanted attention from the IRS, which may increase the likelihood of audits or further penalties in the future.
Delays in filing or processing
Even if you file late but before the IRS revokes your tax-exempt status, your organization might face delays in processing its return, which can hinder its operations. Additionally, reinstating tax-exempt status can be a long and cumbersome process, so prompt action is always in your organization’s best interest.
Pro Tip
Consider using electronic filing options for Form 990 or 990-EZ. This method reduces processing time and minimizes errors compared to paper filings.
What should you do when you receive a CP259H notice?
If you receive a CP259H Notice, here’s a step-by-step guide to ensure that you respond appropriately and maintain your tax-exempt status.
1. Review the notice carefully
The first step is to thoroughly read the CP259H Notice. It contains vital information about the forms that need to be filed, the deadlines involved, and the specific actions the IRS expects you to take. Pay close attention to the name and EIN listed on the notice to ensure accuracy.
2. Confirm whether you filed the required forms
If you believe that your organization has already filed Form 990 or 990-EZ, check your records to confirm the filing date. If the form was filed within the last four weeks, the IRS may not yet have processed it. In this case, you can disregard the notice. However, if it has been more than four weeks or if the form was filed under a different EIN or organization name, you will need to take further action.
3. File or refile form 990 or 990-EZ
If you haven’t filed yet, do so immediately. You can file electronically using an IRS-authorized e-file provider, which is the quickest and most secure method of submission. If you opt for a paper return, ensure it’s signed, dated, and sent using the correct address.
4. Complete the response form
If your organization has already filed the required forms, complete the Response Form enclosed with the CP259H Notice. This form helps the IRS match your filing with their records. Make sure to include a signed copy of the return and provide all necessary details to avoid further complications.
5. Contact the IRS or SSA if necessary
If you filed under a different EIN or name, or if you have any doubts about your organization’s status, contact the IRS for clarification. You may also want to review your filing requirements using resources like the IRS’s “Tax Information for Charities & Other Non-Profits” page.
How to respond to the CP259H notice
Responding promptly is crucial to prevent penalties or loss of tax-exempt status. Here are detailed steps on how to handle the notice effectively:
1. Filing your return
File your organization’s Form 990 or Form 990-EZ electronically. If you file by mail, ensure that all required schedules are attached and that you retain proof of filing.
2. Submit supporting documentation
If you need to prove that your organization has already filed the required form, include a signed and dated copy of your tax return along with the completed Response Form. Mail these documents to the IRS using the envelope provided.
3. Fax the response form
Some organizations prefer to fax their response for quicker processing. Ensure that you send the form to the fax number provided in the notice, and always use a secure fax service to protect sensitive information.
4. Follow up
After submitting the required documents, follow up with the IRS if you don’t receive a response within four weeks. You can also check the status of your return online or by calling the IRS directly.
Pro Tip
Keep meticulous records of all your filings and confirmations. This documentation can serve as proof if any discrepancies arise with the IRS.
Seeking professional help
If you’re unsure how to proceed after receiving a CP259H Notice, there are several support options available to help your organization:
- Consult a certified tax professional or tax attorney who specializes in tax-exempt organizations for personalized advice.
- Visit the IRS website for information on how to file Form 990 or 990-EZ and other requirements for tax-exempt political organizations.
- Contact your local IRS office or use the IRS’s interactive tools and assistant for more guidance on the CP259H Notice and other filing obligations.
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Frequently asked questions
What is the deadline for filing Form 990 or Form 990-EZ?
The deadline for filing Form 990 or Form 990-EZ is typically the 15th day of the 5th month after the end of your organization’s fiscal year. For organizations with a calendar year ending December 31, this means the deadline is May 15 of the following year. If you need additional time, you can file for an automatic 6-month extension using Form 8868.
What are the consequences of not filing Form 990?
Failure to file Form 990 or Form 990-EZ can result in substantial penalties. The IRS may impose fines based on the size of the organization and how late the form is filed. Additionally, if an organization fails to file for three consecutive years, it may automatically lose its tax-exempt status.
How can I verify if my organization is required to file Form 990?
To determine if your organization must file Form 990 or 990-EZ, refer to the IRS guidelines for tax-exempt organizations. Generally, organizations with gross receipts over $50,000 must file, while those below this threshold may qualify to file Form 990-N (e-Postcard) instead. For specific details, consulting a tax professional or reviewing IRS resources is advisable.
Is there a way to appeal if I believe the IRS made an error?
Yes, if you believe the IRS has made an error regarding your organization’s tax status or filing requirements, you can appeal the decision. This process usually involves submitting a written request along with supporting documentation that explains your case. You can contact the IRS directly or consult a tax attorney for guidance on how to proceed.
Can I file Form 990 or 990-EZ after receiving a CP259H Notice?
Yes, you can still file Form 990 or 990-EZ after receiving a CP259H Notice. In fact, it is advisable to do so promptly to avoid penalties. Make sure to complete the Response Form included with the notice and send it to the IRS along with your filed form, as this helps the IRS update their records correctly.
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
- A CP259H Notice is sent by the IRS when a tax-exempt political organization fails to file Form 990 or Form 990-EZ.
- Responding promptly can help your organization avoid penalties and the risk of losing its tax-exempt status.
- If you’ve already filed, verify that the form was processed and send proof along with the Response Form to the IRS.
- If you haven’t filed yet, file Form 990 or 990-EZ immediately and follow the instructions on the CP259H Notice.
- Consulting a tax professional can help ensure you meet your organization’s filing requirements and avoid future notices.
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