What is a CP297 Notice Letter from the IRS?
If you have received a CP297 Notice Letter from the IRS, the most likely scenario is that you are a business owner and have unpaid business taxes. The IRS has requested payment for these unpaid business taxes and has not received a payment or response.
Now they are moving to levy your property. This can include levying your bank accounts, wages, account receivables, and physical property such as a vehicle or home.
There are a few kinds of the CP297 – CP297, CP297A, and CP297C:
- If you’ve received the CP297 Notice Letter, the IRS is formally letting you know they intend to levy – or legally seize – your property. This notice typically gives you 30 days to respond.
- If you’ve received a CP297A or CP297C Notice Letter, the IRS is telling you they already have started seizing your property.
Here is an example of what a CP297 Notice Letter looks like:
What do I do when I receive a CP297 Notice Letter from the IRS?
The first question you want to ask is, “Do I agree that I owe the IRS this amount?”. If the answer is no, you have the right to a Collection Due Process hearing. You would fill out form 12153 to request this. If the answer is yes, there is a second question to ask.
The second question is, “Can I pay this amount right now?”. If the answer is no, you have two main options. One is an Offer in Compromise (OIC). This is when you can show the IRS you do not have funds to pay the total amount and offer to pay a lower amount. This allows the IRS to collect something versus nothing and may be a more viable path for the taxpayer. The second option if the put together a payment plan (sometimes called an installment plan). This is when you agree to pay the IRS the total amount but break it up into smaller payments over a set period of time. If the answer is yes - you can pay the full amount now - then make a payment to settle the tax debt immediately.
I’m overwhelmed, I’m not a tax person, what do I do right now?
It’s critical to act to resolve this as quickly as possible. Do not ignore the notice. Do not delay in responding. Time is of the essence if you’ve received a CP297, CP297A or CP297C – these are final notices. They will not just go away by not dealing with it.
If you need help assessing your options and/or navigating next steps, Safe Harbor is here and ready to help if you need it. We have attorneys, CPAs and business owners – this combination allows us to both help resolve your immediate tax situation and represent you to the IRS. We’re standing by, please feel free to contact us below.