IRS Notice LT16: What It Means and What to Do

irs letter lt16

The Internal Revenue Service (IRS) sends LT16 to people who have unpaid taxes or unfiled tax returns. This letter typically has the heading "Please Call Us About Your Overdue Taxes or Tax Return" and generally comes from the ACS.

IRS LT16 is a notification that the IRS is planning to take enforcement actions against you, and if you receive this letter, you should make arrangements to resolve the situation as quickly as possible.

What to Do If You Receive IRS LT16

The LT16 notice explains why the agency is contacting you and outlines your options. Depending on whether you have unfiled returns or owe a tax bill, you should do the following after receiving this notice:

File your unfiled tax returns
Pay your unpaid tax balance in full
Set up a payment plan with the IRS
Apply for a hardship status if you cannot afford to pay your bill
Start an appeal if you don't agree with the amount of tax owed

You don't have to deal with the IRS on your own. A tax resolution specialist can help you determine the best steps to take, and they can guide you through the process.

What Happens if You Ignore IRS Notice LT16?

LT16 is not the first notice that the IRS sends. Most taxpayers who receive this notice have already been repeatedly notified about their missing tax returns or tax bills, and this notice is the IRS's announcement that it plans to enforce collection action.

If you ignore LT16, the IRS may decide to take the following actions:

Seize your assets
Garnish your wages
Issue a federal tax lien
Take your passport

Penalties and interest will also continue to add up on your tax balance, and if you have unfiled returns, the IRS may file a substitute return for you. Most substitute returns don't include all your deductions and credits, and they typically show a tax liability that is larger than it should be.

What If You Don't Agree With IRS Notice LT16?

There are many situations where you may have received LT16 in error. Here are some of the most common questions we hear from people who have received LT16 in error.

What if I already filed my tax return?

If you filed your tax return over 10 weeks ago, you should send the IRS another signed copy of that year's return. If you filed your return less than 10 weeks ago, the IRS may not have received it yet and you may need to wait.

You can check the status of your submitted returns by creating an online account with the IRS. Alternatively, check your tax software or talk with your accountant to see if the IRS accepted your tax return for the year noted on the LT16 notice.

What if I already paid my tax bill?

If you received a notice of tax due but have already made a payment, keep in mind that payments can take up to 21 days to process. If you have submitted full payment in the last three weeks, disregard the notice. Contact the IRS if you submitted your payment more than 21 days prior to the date on the letter.

What if I have a payment plan for the tax bill on LT16?

If you have set up a payment plan, continue making payments as outlined in your agreement, but if you're still waiting for a payment plan to be approved, try to pay as much as you can upfront to minimize interest and penalties.

What if the tax due on LT16 is incorrect?

If LT16 shows an incorrect tax balance, you have the right to appeal. Follow the instructions on the letter to start the appeal process and gather any documents you have that dispute the IRS's claims. The appeal process can be complicated and you may want to work with a professional.

What if I'm the victim of tax identity theft?

If you believe that you received LT16 due to identity theft, you should call the number noted on the form. You may also need to file Form 14039 (Identity Theft Affidavit) and take additional steps to protect yourself such as freezing your credit.

What if my spouse is responsible for the tax on LT16?

When spouses file a tax return together, they share the responsibility for the tax balance, but there are a few exceptions to this rule. If your spouse was solely responsible for the tax liability on LT16, you may be eligible for innocent spouse relief, but there are very strict requirements for this relief. A tax resolution specialist can help you apply for innocent spouse relief.

Why Is There a QR Code on LT16?

Recently, the IRS decided to redesign several of its notifications including LT16, and one of the design updates included adding a QR code. You can scan this code to get more information on your letter. The QR code should direct you to a relevant section of the IRS's website or to your personal tax account.

How to Deal With IRS Notice LT16

LT16 is a serious notice. The IRS is letting you know that it plans to enforce collection activities on your account, and these actions can include seizing the money in your bank account, garnishing your wages, keeping state tax refunds, placing liens on your assets, or taking your passport. Do not ignore notice LT16. Instead, reach out to a tax professional to help.

At TaxCure, we have an extensive directory of tax resolution specialists who focus on all kinds of different tax issues, and our algorithms can help you find the best professional for your situation.

Don't let the IRS start collection activities on your account — use TaxCure to find a tax specialist to help you today.