IRS CP504 Notice What It Means and How to Respond
Introduction: Don’t Ignore the CP504 Notice — It’s Not Just a Warning
If you’ve received an IRS CP504 Notice, you’re likely already stressed — and with good reason.
CP504 means the IRS is preparing to levy your assets — including your state tax refund, bank account, or wages.
But you still have time to act — especially if you respond to IRS CP504 in Orange County before enforcement begins.
In this guide, we’ll explain what the CP504 notice really means (and some of the other "Love Letters" you may receive), how it fits into the IRS collection process, and how Orange County taxpayers can respond before enforcement begins.
🔍 What Is an IRS CP504 Notice?
A CP504 notice is formally called:
Notice of Intent to Levy – Intent to Seize Your State Tax Refund or Other Property
Certified notices are serious. Often, certified mail from the IRS usually means serious action is coming.
It means the IRS:
- Has assessed a balance you owe
- Sent you earlier notices (CP14, CP501, CP503)
- Hasn’t received payment or a response
- Is preparing to seize assets to satisfy the debt
🧾 What Does the CP504 Notice Include?
The notice outlines:
- The tax year and type of tax owed
- The balance due (including penalties & interest)
- A warning that the IRS may seize your state tax refund, and possibly other assets
- A final payment deadline (usually within 30 days)
🕒 What Happens If You Don’t Respond?
- The IRS may seize your California state refund
- You may receive a Final Notice of Intent to Levy (LT11 or Letter 1058)
- The IRS may proceed to levy:
- Bank accounts
- Wages
- Business receivables
- Social Security payments
This is exactly what happens if you ignore IRS notices — the IRS doesn’t stop, it escalates.
⚖️ How the CP504 Notice Fits in the IRS Collection Process
| Step | Notice | Description |
|---|---|---|
| 1 | CP14 | Balance due reminder |
| 2 | CP501 | First follow-up |
| 3 | CP503 | Second notice |
| 4 | CP504 | Intent to seize state refund + warning of levy |
| 5 | LT11 / Letter 1058 | Final notice before broader levy rights trigger |
| 6 | Enforcement | Bank levy, wage garnishment, etc. |
✅ What You Should Do After Receiving CP504
✅ 1. Confirm the Balance Is Correct
Request or review your IRS transcript. Sometimes CP504 notices are based on:
- Substitute returns
- Unfiled returns
- Incorrect income reporting
If you disagree with the balance, a CPA can file corrected returns or challenge the assessment.
✅ 2. Act Quickly — You May Still Avoid Enforcement
The IRS hasn’t yet levied your accounts, which means you still have options:
- Apply for an IRS offer in compromise settlement if you qualify to settle for less than you owe
- Consider setting up an IRS installment agreement to pay over time
- Request hardship status (CNC) if you truly cannot pay
- File an appeal to delay levy action
✅ 3. Respond in Writing or Through a CPA
Call volume is high and phone reps have limited authority. A written response or CPA-represented negotiation is often more effective.
✅ 4. Request a Payment Plan (Installment Agreement)
If you can’t pay in full, an installment agreement will stop levy action. But beware — when you default on an IRS installment agreement, the IRS can immediately reinstate collections, so it’s critical to stay current.
✅ 5. Qualify for Hardship Relief (CNC Status)
If paying would cause financial hardship, you may qualify for Currently Not Collectible (CNC) status, which temporarily pauses collections.
💼 How Boulanger CPA Helps Orange County Taxpayers
We help individuals and businesses in Irvine, Anaheim, Santa Ana, Fullerton, and surrounding areas, respond to CP504 notices, stop levies and garnishments, and settle your IRS balance before enforcement escalates.
- Interpret and respond to CP504 notices
- Stop IRS levies and wage garnishments
- Set up payment plans or submit Offers in Compromise
- File corrected or missing returns
- Communicate directly with the IRS on your behalf
If you’re searching for IRS tax relief near you, our team is based in Orange County and serves clients across California.
📞 Call
657-218-5700
🌐
www.orangecounty.cpa
Learn more about your options and learn more in Defend What’s Yours to protect your finances before it’s too late.
Frequently Asked Questions
Frequently Asked Questions
What is IRS Notice CP504?
Notice CP504 is a warning that the IRS intends to levy your state tax refund and may take other property if your tax debt is not paid.
Does CP504 mean my bank account or wages will be levied?
Not immediately. CP504 first targets your state tax refund, but it signals that the IRS is moving toward stronger collection actions like wage garnishment or bank levies.
How much time do I have after receiving CP504?
You generally have 30 days from the date of the notice to respond, pay, or make arrangements with the IRS before levy action begins.
What should I do if I can’t pay the full balance?
You can request an installment agreement, apply for an Offer in Compromise, or seek Currently Not Collectible status if you qualify.
Can penalties and interest be reduced?
Possibly. Penalty abatement may be available for reasonable cause or first-time relief, but interest generally continues until the balance is resolved.
What happens if I ignore CP504?
If ignored, the IRS can levy your refund and eventually proceed to broader levies and liens, making the situation far more costly.
Does CP504 affect California taxpayers differently?
No. CP504 is a federal notice, but the IRS can coordinate with California agencies if your state refund is seized or further collection is required.
Should I get professional help after receiving CP504?
Yes. Professional representation ensures you respond correctly, explore relief programs, and avoid levies or garnishments.
📣 About the Author
Marc Boulanger, CPA is the founder of Boulanger CPA and Consulting PC, a boutique tax resolution firm based in Orange County, California and trusted by high-income individuals and business owners across Southern California.
He is the author of Defend What’s Yours: A California Taxpayer’s Guide to Beating the IRS and FTB at Their Own Game, available now on Amazon. The book offers a step-by-step plan for resolving IRS and FTB tax debt without losing your business, your home, or your peace of mind.
With over a decade of experience resolving high-stakes IRS and State tax matters, Marc brings strategic insight to complex cases involving wage garnishments, bank levies, unfiled returns, and six-figure tax debts. He is known for helping clients reduce or eliminate tax liabilities through expertly negotiated settlements and compliance plans.
Marc is a Certified Public Accountant licensed in California and Oklahoma and holds the designation of Certified Tax Representation Consultant. He is a member of the American Society of Tax Problem Solvers (ASTPS) — the national organization founded by the educators and practitioners who have trained thousands of CPAs, EAs, and tax attorneys in IRS representation strategy.
Every case is handled with discretion, proven methodology, and direct CPA-led representation — not call center scripts.
📍 Learn more at www.orangecounty.cpa or call (657) 218-5700.
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