IRS CP71 and CP71C Notices: Annual Reminder of Back Taxes Owed

IRS Notice CP71 and CP71C are annual reminders that you owe tax to the IRS. The IRS may send you this collection notice even if you're already on a payment plan or have your account marked as uncollectible. If you haven't already made arrangements on your tax debt, you should do so now to avoid enforced collection actions.

Here's the good news — you don't have to worry too much about this notice. However, you shouldn't necessarily ignore it either. This guide explains what to expect when you receive this notice.

Key takeaways

CP71 - annual reminder of tax debt owed to the IRS.
When it comes - once a year, even if you're on an installment agreement or currently non-collectible status.
What to expect - if you're on an IRS-approved payment plan or currently non-collectible status, nothing will change after you receive this notice. If you haven't made arrangements on your tax debt, the IRS will add interest and penalties to your account and may send additional collection notices.
How to respond - make payment arrangements if you haven't done so already. Otherwise, you can generally disregard this notice.
What if you disagree - if you disagree with the info on this notice, reach out to a tax pro to talk about options.

What Is IRS CP71 Notice?

CP71 is an annual balance notice that the IRS sends to tell you how much tax, penalty, and interest you owe. This letter is a yearly reminder of your outstanding balance.

IRS Notice CP71 doesn't necessarily mean that the IRS plans to garnish your wages, seize your assets, or levy your bank account. If the IRS plans to enforce these types of collection actions, it will send you a Final Notice of Intent to Levy. This usually comes as CP90 or LT1058, but the final notices can also have other numbers.

What Is Notice CP71C?

Notice CP71C is also an annual reminder of your tax due, but this version of the notice means that your passport may be at risk. The IRS can seize your passport if you owe seriously delinquent tax debt - defined as $65,000 or over as of 2025.

Why Did You Receive the IRS Notice CP71?

Both CP71 and CP71C are automatically generated notices. The IRS's automated collection system (ACS) sends these notices annually to taxpayers who owe a debt to the IRS. You will only receive this notice if the IRS knows that you owe taxes.

Types of CP71 Notices

There are several different types of CP71 notices. Here are the notices in the CP71 series:

CP71B -- Generally for businesses, this notice lists your balance due, including tax, penalties, and interest. It also outlines your options for dealing with your back taxes.
CP71C -- Typically sent to taxpayers who are at risk of losing their passports, this also lists your balance due including tax, penalties, and interest.
CP71S -- This also lists your tax, penalties, and interest, and gives you options for taking care of your tax problems.
CP771 — This is the Spanish language version of the IRS CP71 notice.
CP71U — This notes how much tax, penalties, and interest you owe. It also says that you should pay immediate attention to your unpaid balance, but it doesn't threaten immediate collection actions.

What to Do When You Receive Notice CP71

If you receive Notice CP71, you can contact the IRS directly to make arrangements to take care of your tax debt. Depending on how much you owe and what you can afford to pay, you may be able to set up a payment plan, apply for a settlement on your tax debt, or make other arrangements.

Be aware, however, that when you call the IRS, you get on their radar. For example, if the IRS agent asks you about assets that you could sell to pay your tax debt, you may reveal information that compels the agency to take collection actions against you. You should never hide information from the IRS, but you shouldn't just call and tell them everything either.

Can I Ignore Notice CP71?

You can generally ignore this notice if you have a pre-established arrangement with the IRS. However, if you're on an installment agreement or currently non-collectible status, you may want to contact the IRS to make sure that your plan is still active before you throw this notice in the trash. You can also ignore this notice if you made full payment in the last 21 days - again, however, you may want to double check that the IRS received your payment and credited it to your account correctly.

What If I Disagree With CP71? Can I Appeal the Tax Due?

By the time you receive this notice, it's generally too late to appeal the tax that you owe, but even if you've exhausted your appeal rights, there are ways to deal with an incorrect balance, such as an offer in compromise based on doubt of liability or paying under protest and seeking a refund. You should consult with a tax pro if you disagree with the balance due shown on the notice.

Other possible mistakes that may appear on this notice may include penalties - if the penalties were calculated incorrectly, you should reach out to a tax pro. Even if the penalties are correct, you should look into penalty abatement. The interest is rarely calculated incorrectly, but if you believe there has been an error, you should reach out to the IRS. Note that if the IRS waives penalties, they will also waive the interest associated with the penalties. Finally, another common error may be that the tax debt has already expired - definitely reach out to a tax pro if you think that's the case. The IRS regularly miscalculates tax debt expiration dates.

How to Avoid More Collection Notices

Again, if you already have a payment arrangement with the IRS, you don't have to worry about this notice or about receiving additional collection notices. However, if you don't have an arrangement, this notice may be followed by collection notices that threaten involuntary collection actions such as wage garnishment or asset seizure. To avoid that, contact the IRS to set up one of the following arrangements:

Installment agreement - monthly payment plan.
Offer in compromise - tax settlement based on the taxpayer having limited income or assets.
Currently non-collectible - if you can't afford to pay anything, the IRS will mark your account and pause all collection actions until your finances improve.

There are also other options for very specific situations - for instance, innocent spouse relief in cases where the tax debt came from income that your spouse didn't report on a joint return without your knowledge.

Contact a Tax Professional About Your CP71 Notice

If you contact a tax professional, they'll be able to help you find the best way to deal with your tax debt. For instance, if the collection statute expiration date (CSED) is approaching on your tax debt, your tax debt may expire if you can continue to fly below the radar. Or if you have limited income and assets, a tax pro may be able to leverage your upcoming CSED to get you a partial payment installment agreement or an offer in compromise.

These are just examples. The options vary greatly depending on your situation. When you contact a tax professional, they'll be able to let you know about the best option for your situation. They'll also be able to give you a good idea of which tax relief programs you qualify for.

Get Help With Unpaid IRS Taxes

If you have received IRS notice CP71 or any other notices about an unpaid balance to the IRS, you should reach out to a tax professional for help. They can help you figure out your options based on how much tax you owe. They can negotiate with the IRS on your behalf. They can also help you set up a payment plan or make other arrangements so that you can avoid any unnecessary IRS collections against you.

Using TaxCure, you can search for a tax professional in your area to help you. You can narrow down your results based on experience with specific types of tax problems and solutions. Then, you can contact a local tax pro for a free consultation.