Educational notice: This page provides general information about IRS balance due letters. It is not tax advice and is not affiliated with or endorsed by the IRS.
IRS Balance Due Letters Explained: What They Mean and What Usually Comes Next
IRS balance due letters are notices that say the IRS believes you still owe money for a specific tax year. These letters often start with a basic bill and can become more serious over time if the balance remains unpaid.
On this page, you’ll learn what balance due letters are, why people get them, the common notice sequence (CP14 → CP501 → CP503 → CP504 → final levy notices), and where to find plain-English explanations for each letter.
What Are IRS Balance Due Letters?
IRS balance due letters are part of the IRS collection notice process. They are typically sent when the IRS shows an unpaid amount on your account for a certain year.
Sometimes the balance is expected (for example, a return was filed showing tax owed). Other times, the balance can be confusing (for example, penalties and interest increased the amount over time).
Takeaway: A “balance due” letter is the IRS saying, “Our records show you still owe something.”
Why Do People Get Balance Due Letters?
Balance due letters are common. Many people receive them even when they filed correctly. A balance can exist for several normal reasons.
Common causes include:
- Tax owed on the return was not paid in full
- Withholding was not enough for the year
- Estimated tax payments were too low
- Penalties and interest increased the amount over time
- A small IRS processing adjustment changed the balance
Takeaway: Many balance due letters are about timing and math, not wrongdoing.
The Typical IRS Balance Due Letter Sequence (Simple Timeline)
While not everyone receives the exact same series, many balance due cases follow a general pattern. The letters tend to get firmer as time passes.
Common sequence:
The main idea is simple: early letters are usually “bill and reminder” notices, and later letters are “warning and final notice” letters.
Takeaway: If the letters are getting stronger, it usually means the case is moving later in the timeline.
Which Balance Due Letter Do You Have?
If you see one of these codes on your notice, start with the matching page:
- CP14 Notice Explained — first balance due notice
- CP501 Notice Explained — reminder notice
- CP503 Notice Explained — stronger reminder
- CP504 Notice Explained — state tax refund levy warning
- LT11 Notice Explained — final intent to levy + hearing rights
- CP90 Notice Explained — intent to levy + hearing rights
- Letter 1058 Explained — final intent to levy + hearing rights
Takeaway: The notice code is your shortcut to understanding what the IRS is saying.
Balance Due Letters vs “Mismatch” Letters (Quick Difference)
Not all IRS letters are balance due letters. Some letters are about mismatched information. A common example is a CP2000, which usually relates to a proposed change because the IRS believes something on a return does not match forms they received.
Balance due letters focus on collection. Mismatch letters focus on reconciling information.
Takeaway: CP2000 is typically a “review/mismatch” letter, not a “pay now” letter.
What to Check First on Any Balance Due Letter
If you are unsure where to begin, these are the most important items people usually check:
- Letter code (CP14, CP501, CP503, CP504, LT11, CP90, 1058)
- Tax year involved
- Amount shown and what date it is “as of”
- Any deadline printed on the notice
- Summary section that explains what the IRS is requesting
Takeaway: Code + year + deadline is usually the fastest way to get oriented.
Helpful Site Pages
Frequently Asked Questions About IRS Balance Due Letters
Are IRS balance due letters the same as an audit?
No. Balance due letters are generally part of the IRS collection process. Audit letters focus on verifying return items, not collecting a balance.
Is CP14 the first IRS balance due notice?
In many cases, yes. CP14 is commonly the first balance due notice after tax is assessed.
Does CP504 mean the IRS is taking my bank account?
CP504 is a warning notice and commonly refers to a possible levy of a state tax refund. It is not the same as a final intent-to-levy notice.
What is the “final notice” in the balance due sequence?
Many cases end with a final intent-to-levy notice that includes hearing rights, such as LT11, CP90, or Letter 1058.
When should someone talk to a licensed tax professional?
If you need advice specific to your situation, a licensed professional (EA/CPA/attorney) can review your notice and your account details. This site is for education, not personalized tax or legal advice.
This page is for general educational purposes only and does not provide tax or legal advice. WhatThisIRSLetterMeans.com is not affiliated with the IRS or any government agency.