IRS Letter 2357C: What It Means and How to Resolve it
Summary:
IRS Letter 2357C notifies taxpayers about the IRS’s decision to abate penalties and interest due to errors, such as not sending prior balance due notices. However, taxpayers may still owe taxes. This letter explains the changes to your account and outlines the steps you need to take. We’ll break down the letter’s meaning, why you received it, and how to respond, including disputing the taxes owed or making payment arrangements.
Receiving a notice from the IRS is often stressful, especially when it involves a balance due. IRS Letter 2357C informs you that penalties and interest on your tax account have been removed because of an error by the IRS. While this may seem like a relief, it is important to act quickly, as there may still be taxes to pay. In this article, we’ll help you understand what IRS Letter 2357C is, why you received it, and the best way to handle it.
What is IRS Letter 2357C?
IRS Letter 2357C is a notice sent by the IRS to inform taxpayers that penalties and interest have been abated from their account. Abatement refers to the reduction or removal of charges that were previously added to your tax balance, typically due to the IRS’s failure to send required notices in a timely manner.
Why the IRS sends Letter 2357C
The IRS issues Letter 2357C for several reasons:
- The IRS missed sending balance due notices in the past, so they abate penalties and interest associated with the delay.
- The IRS has reviewed your account and found that errors were made in processing or communication.
- You still owe a balance, but the IRS has removed the extra charges to correct the mistake.
While this abatement can reduce the amount you owe, it’s important to note that the principal tax balance may still be due.
Pro Tip
Set up IRS account alerts online to get real-time notifications on any changes to your tax return or account. This helps you stay updated on adjustments and due dates.
How the IRS calculates penalties and interest
When the IRS assesses a balance on your account, penalties and interest typically begin accruing from the date of the initial tax due. These penalties can accumulate quickly if not addressed. Common penalties include:
- Failure-to-pay penalty: Charged when taxes are unpaid after the filing deadline.
- Failure-to-file penalty: Assessed when a return is filed late or not at all.
- Interest on unpaid taxes: Calculated daily based on the amount owed.
When the IRS makes a mistake, such as not sending timely notices, these penalties may be removed. However, interest may continue to accrue on any remaining balance.
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Why you received IRS Letter 2357C
You may have received IRS Letter 2357C for the following reasons:
- You owe a balance to the IRS, but they failed to send required notices to inform you of the debt.
- Because of their error, the IRS has adjusted your account and removed penalties and interest.
- Even though penalties have been reduced, you still have an outstanding tax balance that requires payment.
In this case, the letter serves as a notification of the abatement of penalties and interest, but it also serves as a reminder that you still owe taxes and need to take action.
Pro Tip
Always review IRS notices carefully to ensure that all abatement calculations are correct. If something looks off, contact the IRS immediately to dispute or seek clarification.
What should you do after receiving IRS Letter 2357C?
Upon receiving IRS Letter 2357C, it’s important to act promptly to prevent further issues. Here are the steps you should follow:
- Review the notice carefully: Make sure you understand which penalties were abated and the remaining balance you owe.
- Contact the IRS if needed: If you disagree with the balance or abatement details, you can contact the IRS for clarification or dispute the balance.
- Arrange payment: If you still owe taxes, arrange to pay the remaining balance either in full or through a payment plan.
Ignoring the notice could lead to further interest and penalties accumulating on any unpaid taxes.
How to respond to IRS Letter 2357C
Steps to take when responding
To respond to IRS Letter 2357C, you need to take the following steps:
- First, ensure that the IRS has correctly abated the penalties and interest. If you believe an error remains, you can dispute the balance by contacting the IRS or using their online portal.
- Next, if you still owe taxes, make arrangements to pay the balance. The IRS offers several payment options, including online payments and installment agreements.
- If you are unable to pay the full amount, consider setting up a payment plan with the IRS. They offer options that allow you to make monthly payments based on your ability to pay.
If you take no action, interest will continue to accrue on any remaining balance, and further penalties may be applied.
Dispute your balance
If you believe the remaining balance is incorrect, you have the right to dispute it. You can submit a written request for reconsideration along with supporting documentation that shows why the balance is inaccurate. This could include tax returns, receipts, or other records that support your claim. The IRS will review your dispute and notify you of their decision.
Consequences of ignoring IRS Letter 2357C
If you ignore IRS Letter 2357C and fail to address the remaining balance, you could face serious consequences:
- Additional penalties and interest: The IRS will continue to charge interest on the unpaid balance, and further penalties may be assessed.
- Collection actions: The IRS has the authority to take enforcement actions, including wage garnishment, bank levies, and liens on your property.
- Credit impact: Unpaid taxes may be reported to credit bureaus, affecting your credit score and financial standing.
Responding quickly can help you avoid these potential outcomes and resolve the issue in a timely manner.
Pro Tip
If you are unable to pay the remaining balance in full, request an IRS installment plan. This prevents further penalties and interest from accumulating while you pay off the debt.
Payment options for resolving the balance
If you still owe taxes after receiving IRS Letter 2357C, the IRS provides multiple payment options to help you settle your debt:
- Pay online: The IRS allows for easy online payments through their website. You can use a bank account, credit card, or debit card.
- Installment agreement: If you cannot pay the full balance upfront, the IRS offers installment plans that allow you to pay over time. These plans can be requested online or by submitting Form 9465, “Installment Agreement Request.”
- Offer in Compromise: In rare cases, the IRS may accept a lower amount than what is owed through an Offer in Compromise, but this requires meeting specific eligibility criteria.
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Frequently asked questions
What does “abatement” mean in IRS Letter 2357C?
Abatement refers to the removal or reduction of penalties and interest from your tax account. In the case of IRS Letter 2357C, the IRS acknowledges an error, such as failing to send a required balance due notice, and removes the penalties and interest that resulted from that error. However, this does not necessarily eliminate the entire tax balance, and you may still owe taxes.
Do I still owe taxes after receiving IRS Letter 2357C?
Yes, you may still owe taxes after receiving IRS Letter 2357C. The letter notifies you that penalties and interest have been abated due to an IRS error, but the original tax balance may remain. It’s important to check the letter for any remaining balance due and make arrangements to pay it as soon as possible to avoid further interest charges.
Can I request a further reduction or abatement after receiving IRS Letter 2357C?
Yes, if you believe there is still an error or if you qualify for further penalty relief, you can request an additional abatement. To do so, you will need to submit a written request to the IRS, providing documentation that supports your claim for a further reduction. It’s also possible to request penalty relief if you meet the IRS’s criteria for reasonable cause, such as illness or a natural disaster.
How long do I have to respond to IRS Letter 2357C?
Typically, IRS Letter 2357C gives you a response deadline of 10 days. This is the timeframe in which you should make arrangements to pay the remaining balance or dispute any errors in the notice. If you do not respond by the deadline, interest and penalties could continue to accrue on the remaining balance.
What happens if I don’t take action after receiving IRS Letter 2357C?
If you fail to respond or take action after receiving IRS Letter 2357C, the IRS may apply additional penalties and interest to your account. Over time, this could lead to enforcement actions such as wage garnishment, levies on your bank accounts, or placing liens on your property. It’s crucial to address the notice promptly to avoid these consequences.
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
- IRS Letter 2357C informs you that penalties and interest have been removed, but taxes may still be due.
- Failure to address the remaining balance could result in additional interest, penalties, and IRS enforcement actions.
- Contact the IRS promptly if you need to dispute the balance or set up a payment plan.
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