The IRS CP71 Notice is an annual reminder of your unresolved tax balance. In some cases, this notice means you need to act to avoid consequences or additional penalties. But if you’re already on a payment plan or non-collectible status, this notice will still come annually to remind you of your balance due.

Find out everything to know about the CP71 Notice on this page. When you need assistance responding to an IRS notice or have questions about your tax debt, contact the team at Seattle Legal Services today.

Key Takeaways:

  • The IRS is required to send Notice CP71 to taxpayers who have an unpaid balance, even if they have a payment plan or other agreement set up with the IRS.
  • Notice CP71 outlines how much you owe the IRS, including accrued penalties and interest.
  • You may not need to do anything about your CP71 Notice if you are already working with the IRS on making payments.
  • If you ignore the notice and do nothing to pay off your debt, the IRS could then revoke your passport or pursue liens and levies.
  • Notice CP71C is a type of CP71 Notice that focuses on passport revocation.

Reasons You Would Receive IRS Notice CP71

Before you start to feel stressed about your tax notice, it’s important to know that the IRS is required to send out CP71 every year to taxpayers with outstanding tax debt. Nothing you did recently triggered this notice, it’s just an annual requirement.

You may receive this notice because of the following:

  • You have unpaid taxes that could be from a previous tax year.
  • Your account is in CNC status but you still have an unpaid balance.
  • You have an active payment plan set up with the IRS, or you have an agreement in default.
  • You may be facing passport revocation if your debt is more than $64,000. If this is the case, you will probably receive the CP71C Notice instead of the standard CP71.

No matter your situation, CP71 will not be the first notice the IRS sends you, so you won’t get it out of the blue. You should have already been notified about your debt and any associated penalties through notices like CP14, CP501, and others.

What to Do If You Receive a CP71 Notice

Your notice may include a deadline that indicates you’re required to pay the unpaid tax balance by this date. This could happen if you owe and you don’t have another solution in place, like a payment plan. If you’re required to pay, you can:

    • Pay the balance in full (which helps you avoid further penalties and interest). You can typically pay quickly online with a card, through the mail at the address on your notice, or through setting up direct debit.
  • Ask for another payment option if you can’t pay in full:
    • Set up an installment agreement: Most taxpayers can apply online for a payment plan, in which you’ll pay off your debt in monthly installments.
    • Request an offer in compromise: If you qualify and are approved, you may be able to submit an offer based on your finances and settle for less.
    • Request CNC status: This status applies to taxpayers who are going through financial hardship. You may need to send in information about your situation to the IRS to initiate this pause on collections, which is only temporary.

The IRS almost always has an option available to you if you can’t pay off your full balance right now. Work with a tax attorney at Seattle Legal Services when you’re not sure what your options are or what to do next.

When Are You Not Required to Pay?

If you have an agreement set up with the IRS and you’re not required to pay the full balance, you will still receive Notice CP71 as a reminder once a year. The following cases may not require you to do anything right now:

  • Account in CNC status: You still have your balance, but you don’t currently have to pay while this temporary collection pause is in effect.
  • Active payment plan: If this is the case, the notice is to inform you of your outstanding balance only. All you have to do is keep complying with your installment agreement. Make payments on time to avoid defaulting on the plan.
  • Refund offset: In some cases, the IRS may apply your tax refund to your outstanding balance. Even if this is your situation, you’ll receive the required annual CP71 Notice.

If you’re not sure about your CP71 notice or whether you have to pay, read the notice thoroughly or call the IRS using the number on your notice. You can also log in to your IRS Online Account to view the latest information.

Always talk through your case with a tax professional if your balance is high or you have a complicated situation.

What If You Ignore CP71?

You should never ignore IRS notices of any kind. Even if your notice is just an informational CP71, you still need to read every section carefully to ensure the information matches your records and that you don’t have to do anything right now.

If you ignore Notice CP71 and you are required to act, here are the potential consequences:

Accruing Penalties and Interest

Your balance will continue to accrue penalties and interest if you don’t pay it off. You’ll still accrue penalties and interest on your account even if you have a current installment agreement in place and comply with the terms. However, the IRS states that the failure-to-pay penalty, which is normally 0.5% of your unpaid taxes, is reduced by half if you have a plan in place.

Passport Revocation

The IRS may revoke your passport in some cases where you owe more than $65,000 in tax debt, as of 2025 – note this number is indexed to inflation. Pay attention to any language on your Notice CP71 or CP71C about potential passport revocation. The IRS won’t take this step if you have another agreement in place to pay off your debt. Check out this guide to Notice CP71C if you’ve received that notice.

Refund Seizure

Some taxpayers may still get a refund for a given tax year, even if they owe back taxes. The IRS could seize tax refunds owed you, whether this year or in the future if you continue to have an unpaid balance and don’t take any steps to rectify the issue.

Further Collection Actions

If you ignore IRS notices, including the CP71 Notice, and you don’t have a plan in place to address your unpaid taxes, the IRS may move forward with escalating collection actions. Aside from passport revocation, the IRS could also file a federal tax lien against you, issue a tax levy that indicates asset seizure or garnish your wages to cover your tax debt. You want to act before the IRS takes these actions to avoid risks to your property or assets.

What’s Included on Notice CP71?

So, what can you expect to find on your IRS CP71 Notice? While each notice will have different information based on your situation and your balance, there are some general sections included on most of these notices:

Your Information

The notice will be addressed to you at the address the IRS has on file. It will also include the applicable tax year for the enclosed balance, the date of the notice, your tax ID number, and the IRS phone number to contact.

Amount Due and Summary

The first page of your notice has your total amount due in large print, along with a breakdown of what’s included in that amount under Billing Summary. This includes your original amount owed, penalties you have accrued, and interest charges.

Information About the Notice Requirement

The IRS also states that they are required to send you this notice annually. The notice then indicates that if you have another solution in place to address your balance, you don’t need to do anything in response to the notice.

Payment Due Date

The notice also includes a payment deadline on the first page. However, remember that this could be included even if you don’t have to pay in full by that date. If you don’t have another arrangement in place, this is the date by which you need to send payment or set up a payment plan.

Instructions if You Agree or Disagree

The next page outlines what to do immediately if you agree or disagree with the amount and details shown. If you agree, you need to pay by the deadline. You can do so online or by sending a check or money order with the enclosed pay stub to the address provided.

If you disagree with the tax balance provided, call the IRS at the provided number to discuss the issue. You can also ask a tax professional what to do if you don’t agree and what information you need to have when you call the IRS.

Payment Options

IRS Notice CP71 then outlines detailed instructions for making your payment:

  • Electronic: You can pay online at irs.gov/payments with a bank account or debit card. If you use a credit card, you’ll have to pay an extra fee.
  • Payment plan: The notice informs you of the option to set up an installment agreement at irs.gov/opa, which will prevent further IRS collection actions and help you pay off your balance over time.
  • Offer in compromise: You may be able to settle your debt for less if you qualify. Visit irs.gov/oic to find more information.
  • Online account access: At irs.gov/account you can view your current balance and payment history, or you can request tax records. This information helps you verify the notice details and figure out next steps.

What Happens If You Do Nothing?

The notice includes what will happen if you ignore your obligations. If you continue to not pay, you’ll keep receiving the annual notice until the collection statute expiration date (CSED) expires, which is 10 years. The IRS states that it could then pursue liens and levies.

Penalty Information

If you’ve incurred penalties, the next sections will outline penalties like the failure to pay penalty, what it means, how it’s calculated, and your current penalty balance. Then, you will find instructions for requesting penalty abatement, either because it’s your first tax penalty in the last three years (first-time penalty abatement) or you have reasonable cause, such as a natural disaster or the death of a family member, that prevented you from paying.

You also may be able to get penalties waived if you followed wrong advice from the IRS. You can pursue this option by calling the number on the notice.

Interest Summary

The next section outlines your total interest owed and how the IRS calculates interest. It includes each applicable period and what the interest rate is for that period. Remember that interest is constantly accruing on your balance until it’s paid in full.

Resources and Contact Information

The last section provides URLs and phone numbers to reference to learn more about your notice. If you still have questions, work with an experienced tax professional who can help you understand your options for paying off your back taxes.

How to Get Help with Your CP71 Notice

If you’ve received a CP71 Notice from the IRS, don’t panic. The IRS is required to send out these notices annually to inform you of your unpaid tax balance — even if you have an agreement in place to pay off your debt. You don’t necessarily have to do anything in response to the notice unless you are not working with the IRS to get your balance paid off.

When you’re not sure what to do next, get in touch with the tax experts at Seattle Legal Services. We work closely with you to find the tax resolution option that fits your needs and your budget. We can also help you if you’re facing more serious IRS actions like liens, levies, or wage garnishment, or if you’re navigating a tax audit. We can help you apply for an installment agreement, offer in compromise, CNC status, and more.

Contact Seattle Legal Services to set up your consultation with a tax attorney now.