This is a notice the taxpayer would receive if he or she has an installment agreement with the IRS for an outstanding tax balance and the IRS considers you in default on your installment agreement. Examples of default causing actions are: missing a payment, new balance due, or not filing a tax return. The notice also informs you of what the IRS intends to do to collect the taxes owed, which can include filing a federal tax lien or seizing (levying) your wages and/or bank accounts.

You should call the IRS at the phone number listed in the header section to determine what steps you need to take to correct the problem. You have 30 days from the date of the notice to contact the IRS and resolve the issue.

If you don’t agree with the reason for the cancellation of the installment agreement, call the number at the top of the notice to discuss it with the IRS. The installment agreement may be reinstated (an additional fee may apply) or if the issue cannot be resolved you have the right to file an appeal.

Sections of the Notice:

  • Header Section
    This area contains the Notice Number, the applicable tax year, the notice date, your Social Security Number, and the IRS contact number.
  • Explanation Section
    This section of the notice will state that the IRS is terminating your installment agreement and that they consider the full remaining balance due. The cause for the default is also listed. The information also presents the balance due for the tax period, the last payment made, and any applicable interest and/or penalties.
  • Response Section
    The notice will direct you to contact the IRS at the phone number listed in the header section if you do not agree. There will also be additional information about your right to request an appeal.
  • Penalties Section
    This section provides a break-down of the types and amounts of interest and/or penalties being assessed.

 

Sample CP 523:
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