If you’ve received a letter from the IRS marked “CP504 — Final Notice: Intent to Levy or Seize Assets”, you’re standing at the most critical stage of the IRS collection process. The CP504 notice is not a routine reminder — it’s the IRS’s final warning before legal enforcement begins. It signals that if you do not act within 30 days, the IRS can:
- Levy (seize) your state tax refund immediately,
- File a Federal Tax Lien against your property, or
- Begin steps toward wage garnishment or bank levy.
📘 Official IRS References: Understanding your CP504 notice
What the IRS CP504 Notice Really Means?
The CP504 is the IRS’s “Final Notice” before levy action. This notice means the IRS has already:
- Assessed your unpaid tax,
- Sent earlier reminders (CP14, CP501, CP503), and
- Received no payment or resolution response.
💡 Insight: A CP504 notice doesn’t mean seizure has occurred — yet. It’s your last opportunity to stop enforcement before the IRS gains full legal authority to act.
Key Sections of a CP504 Notice
A CP504 letter contains crucial information taxpayers often overlook. Here’s how to read it:
| Section | Description |
|---|---|
| Header | States “Intent to Levy — Notice of Your Right to a Hearing” |
| Amount You Owe | Total balance due, including penalties and interest |
| Response Deadline | Typically 30 days from the notice date |
| Payment Options | Online, by mail, or through payment plan |
📘 Reference: Publication 594 — The IRS Collection Process
Where CP504 Fits in the IRS Collection Timeline
The CP504 notice is issued late in the IRS collection timeline, serving as a formal “Notice of Intent to Levy” specific to a taxpayer’s state tax refund and other federal payments. It is a critical escalation that typically follows several unanswered balance due reminders and precedes more aggressive actions like wage garnishments and bank account seizures.
| Notice | Stage | IRS Authority Level |
|---|---|---|
| CP14 | First notice of balance due | Informational |
| CP501 | Reminder of unpaid tax | Mild warning |
| CP503 | Urgent notice | Pre-enforcement |
| ✅ CP504 | Final notice before levy | Legal authority for state refund levy |
| LT11 / Letter 1058 | Final legal notice of levy | Full enforcement rights |
The Legal Power Behind CP504 — IRC §6331(d)
Under Internal Revenue Code §6331(d), the IRS must provide written notice at least 30 days before a levy.
How to Respond to a CP504 Notice?
You have several options, depending on your financial situation and the accuracy of the balance.
1️⃣ Verify the Amount Owed
Verify the amount owed. Request an IRS Account Transcript through your IRS online. A tax attorney can audit the assessment and file for abatement if errors exist.
2️⃣ Set Up an Installment Agreement
If you can afford monthly payments, the IRS may approve an Installment Agreement, avoiding levies entirely.
💡 Insight: Attorneys can request a “collection hold” while submitting a payment plan proposal — temporarily freezing levies.
📘 Reference: IRS Payment Plans
3️⃣ Submit an Offer in Compromise
If you can’t pay the full amount, the Offer in Compromise (OIC) program allows you to settle for less than you owe.
Eligibility depends on:
- Your income and expenses
- Equity in assets
- Future earning potential
💡 Note: Submitting an OIC pauses IRS collections during review — protecting you while negotiations proceed.
📘 Reference: Offer in Compromise — IRS.gov
4️⃣ Request “Currently Not Collectible” (CNC) Status
If you’re experiencing financial hardship — job loss, medical issues, or limited income — you can request CNC status.
This status:
- Halts IRS collections
- Prevents new liens or levies
- Allows time for financial recovery
💡Tip: CNC status doesn’t erase your debt but buys valuable time — especially when the 10-year statute of limitations is near.
📘 Reference: “Currently Not Collectible” (CNC) Status
Why Legal Representation Matters for CP504?
A CP504 notice is not a DIY tax issue — it’s a legal enforcement matter governed by federal collection laws.
| IRS Stage | Attorney Role | Potential Outcome |
|---|---|---|
| CP504 Received | File appeal, stop levy countdown | Enforcement paused |
| Lien Threatened | Request withdrawal or subordination | Credit protected |
| Levy Imminent | Negotiate payment plan or CNC | Property protected |
| OIC Considered | File settlement offer | Reduce total balance |
| Hardship Claim | Prove financial distress | Stop all collection activity |
💡 Insight: Tax attorneys understand how to leverage procedural rights and IRS deadlines to protect clients — often reducing or eliminating debt exposure entirely.
📘 Reference: Form 2848 – Power of Attorney
CP504 Is Your Last Chance to Take Control
The IRS CP504 notice is a final legal warning — and one of the most time-sensitive letters you’ll ever receive. Ignoring it can lead to wage garnishments, frozen bank accounts, and public liens within weeks. But with the right representation, you can still:
- Stop enforcement immediately
- Negotiate manageable payment plans or settlements
- Prevent damage to your credit and assets
Contact Pelham PLLC today for a confidential CP504 notice consultation.
Our experienced tax attorneys will:
- Review your IRS account transcripts
- File immediate appeals or levy protection requests
- Negotiate payment, settlement, or hardship relief
- Protect your income, property, and financial future
Don’t let the IRS act first — take back control today.
FAQs
What does CP504 mean?
It’s the IRS’s final notice before they can legally levy your state refund and begin asset seizures if you don’t respond.
Can I call the IRS to fix this myself?
You can, but the IRS representative’s job is to collect, not advise. Legal counsel ensures your rights are protected.
What happens if I do nothing?
The IRS will begin levying your refund and other assets — and can escalate to garnishing wages and freezing bank accounts.
