Reviewed November 2026. This is general information, not tax advice for your situation.
A CP504 usually comes after a CP14 and one or two reminders went unpaid. It’s the IRS’s formal notice that it intends to levy, which means taking money or property to pay the balance. It’s serious, but it isn’t the last step, and you still have options.
What the IRS can take
The notice lists a state tax refund first. Texas has no state income tax, so there’s usually no state refund to take. That makes the next steps on the list matter more: wages, bank accounts, Social Security benefits and other property. The IRS can also file a federal tax lien.
The penalty goes up
Once a notice of intent to levy is issued, the late-payment penalty doubles from 0.5% to 1% a month. The increase starts 10 days after the notice.
It isn’t the final notice
The CP504 isn’t the notice that gives you a formal appeal hearing. That comes with the IRS’s final notice (Letter LT11 or Letter 1058), which gives you 30 days to request a Collection Due Process hearing. Before that, you can still use the Collection Appeals Program.
Passports
If your debt reaches the IRS’s “seriously delinquent” level, the State Department generally can’t issue or renew your passport until it’s resolved.
What to do now
- Pay in full if you can, online or by mail with the bottom of the notice.
- Ask for a payment plan. The IRS generally won’t levy while a plan request is pending or in place. See IRS payment plans.
- Check the penalties. Some or all of them may come off. See penalty relief.
- Have someone talk to the IRS for you. With a signed Form 2848, I handle the calls.
How I help
I pull your transcripts, confirm what’s actually owed, and get a plan or relief in place before a levy happens. More on my IRS Tax Resolution service. Book a free 15-minute consultation.
Sources: IRC §§ 6159, 6330, 6331(d) and (k), 6651(d) and 7345; IRS, Understanding your CP504 notice.
