A [CP504](/resources/irs-notices/cp504) in your mailbox is a serious warning, but it's widely misunderstood — and the right response depends on what type of notice it actually is.
What the CP504 actually does
A CP504 (sometimes labeled CP504B for businesses) is the IRS's Notice of Intent to Seize (Levy) Your State Tax Refund. Under IRC § 6331(d), this gives the IRS authority to:
- Seize any state income tax refund you're entitled to.
- Search for and levy other assets (bank accounts, accounts receivable).
- File a Notice of Federal Tax Lien if not already filed.
What it does not do — yet — is trigger the Collection Due Process (CDP) rights that come with a Final Notice of Intent to Levy (LT11 or Letter 1058). CDP gives you the right to appeal to the Office of Appeals and request alternative collection measures.
The notice sequence
| Notice | What it means | Time you have |
|---|---|---|
| CP14 | Initial balance due | Pay or set up plan |
| CP501 / CP503 | Reminder notices | Increasing urgency |
| CP504 | Intent to levy state refund + asset search | ~30 days before escalation |
| LT11 / Letter 1058 | Final Notice of Intent to Levy + CDP rights | 30 days to file Form 12153 |
| Form 668-A / 668-W | Actual levy on bank / wages | Levy in effect |
What to do in the next 30 days
Dealing with this right now?
Get a free 15-minute case review with a CPA.
No sales pitch. You'll leave knowing exactly where you stand — even if you don't hire us.
- Pull your account transcript. Verify the balance and confirm whether an LT11 has also been issued.
- Don't pay blindly. If the balance is wrong (common with SFR filings or missed amendments), paying locks it in.
- Don't sign Form 433 over the phone. A Revenue Officer will use it to set up the wrong resolution if you're not represented.
- File [Form 2848](/resources/irs-forms#form-2848) (Power of Attorney) so a CPA can handle every contact going forward.
- Choose a resolution — installment agreement, CNC, OIC, or appeals — based on the facts.
How to stop escalation
The IRS will stop escalating collection actions once an acceptable resolution is in place. The fastest paths:
- Streamlined Installment Agreement if your balance is under $50,000.
- Currently Not Collectible (CNC) if a payment would prevent you from meeting basic living expenses under Collection Financial Standards.
- Offer in Compromise if your Reasonable Collection Potential is below your balance.
What ignoring a CP504 actually triggers
Most CP504 recipients who do nothing see one of three things within 60 to 90 days:
- A state refund offset that's small but immediate.
- An LT11 / Letter 1058 giving 30 days to file a CDP appeal.
- A bank levy or wage garnishment if the LT11's 30-day window also lapses.
If your CP504 just arrived, call (214) 646-3802. We can have a Power of Attorney filed today.
Primary sources & authority
We cite the underlying IRS publications and statutes so you can verify everything on this page.
Franklin Sofi is a MBA, CPA, CTRS and the founder of Comprehensive Tax Resolution LLC. Franklin Sofi is the founder of Comprehensive Tax Resolution LLC. He holds an MBA and is a Certified Public Accountant (CPA), Certified Tax Resolution Specialist (CTRS), and a Gold Member of the American Society of Tax Problem Solvers (ASTPS).