CP71 Notice: The IRS’s Yearly Reminder of a Tax Balance You Still Owe

What the CP71 notice says

The IRS page opens: “We sent you this notice because you still have an unpaid balance on one of your tax accounts and it requires your immediate attention.” It adds that the notice explains the State Department’s power to deny or revoke a passport when a person has a seriously delinquent tax debt.

The Internal Revenue Manual (IRM), the IRS’s staff rulebook, names it “Taxes Still Owed - Annual Reminder.” It says the IRS sends it once a year to remind a taxpayer of a balance due, including penalty and interest. The IRS page tells you to pay online, by mail in the envelope that came with the notice, or through a payment plan.

One number, five reminders

The letter after the number tells you which reminder you hold. The IRM gives each one its own rules.

A CP71A goes to an account the IRS has put in currently not collectible status, which means the IRS has paused collection for now. The IRS page for the CP71A says your account “will remain in non-collectable status until your financial situation changes,” and that if your situation has not changed, you do not need to do anything now. The IRM tells IRS staff to explain that the CP71A is an annual notice and that the IRS takes no enforcement action now. Our CNC calculator checks whether your income and expenses still fit that status.

A CP71C goes to an account that has waited in the IRS collection queue for at least a year. Our CP71C page covers it.

A CP71D, the IRM says, goes once a year on certain accounts in collection with a balance of $25.00 or more, one notice for each tax period. If you already work with a revenue officer, an IRS collection employee, contact that person.

A CP71H reminds you of an unpaid shared responsibility payment, the Affordable Care Act charge for going without health coverage. The IRM tells IRS staff to explain that this payment carries no penalties, liens or levies, but interest keeps adding up and the IRS may apply your federal tax refunds to it.

What to do now

Check the balance first. The IRS page says: “If you paid your balance in full within the last 21 days, please disregard the CP71 you received.” If you have an approved installment agreement, it says to keep paying as agreed.

If you cannot pay in full, pay what you can now. Then apply for a payment plan, ask about a temporary delay for hardship, or see if an offer in compromise fits. Our collection alternatives router compares those paths. If you pay by mail, the IRS page says to use the envelope it sent and include the bottom part of the notice.

If you disagree, the IRS page tells you to call the toll-free number on the notice. Have papers ready that show you paid the debt or do not owe the tax.

What happens if you do nothing

The IRS page lists three results. Interest keeps adding up, and more penalties may apply. The IRS may take your future tax refunds until you pay the balance. And the State Department may deny or revoke a passport if the IRS certifies the debt as seriously delinquent.

Certification has limits in the law. IRC 7345 covers an assessed debt of an individual above a dollar amount that rises with inflation, and only after the IRS files a lien and the hearing rights run out, or after it levies. It leaves out a debt you pay on time under an installment agreement or an offer in compromise, and a debt while a Collection Due Process hearing on a levy is pending.

What people mistake the CP71 for

Some readers take a CP71 for a new bill. It reminds you of a balance the IRS already has on record.

Others read a quiet year as a sign the IRS dropped the debt. The CP71 says otherwise: the balance, the penalties and the interest remain, and the IRS can keep taking refunds toward it. Even in currently not collectible status, the IRS page for the CP71A says paying as soon as you can “will minimize interest and penalties.”

Common Questions