IRS Payment Notices and Pending Check Payment

IRS Payment Notices and Pending Check Payment

Are you waiting for the IRS to cash your check? Due to COVID-19 the IRS has a backlog of unopened mail. Here’s what you need to know:

Pending Check Payments and Payment Notices
  • If a taxpayer mailed a check (either with or without a tax return), it may still be unopened in the backlog of mail the IRS is processing due to COVID-19. Any payments will be posted as the date we received them rather than the date the agency processed them. To avoid penalties and interest, taxpayers should not cancel their checks and should ensure funds continue to be available so the IRS can process them.
  • To provide fair and equitable treatment, the IRS is providing relief from bad check penalties for dishonored checks the agency received between March 1 and July 15 due to delays in this IRS processing. However, interest and penalties may still apply.
  • Due to high call volumes, the IRS suggests waiting to contact the agency about any unprocessed paper payments still pending. See for options to make payments other than by mail.
IRS Will Stop Sending Collection Notices Until Mail is Opened

The Internal Revenue Service heard the complaints about incorrect unpaid tax notices. It announced on August 21st that it is temporarily halting the mailing of three nonpayment notices.

The decision came after a lot of public outcry, some of it among taxpayers and the professional tax community on social media, as well as letter from the chairman of the House Ways and Means Committee. The notice problem was the result of the Coronavirus pandemic. The IRS closed most of its physical operations in March and most employees did not return until the end of June, but delivery of the mail kept continued.

According to the letter to the IRS by Rep. Richard Neal (D-Massachusetts), chair of the tax-writing Ways & Means Committee, 12 million pieces of mail were stacked up in IRS processing centers. Neal’s letter to IRS Commissioner Chuck Rettig urged the agency to stop sending the nonpayment notices until it cleared its mail backlog. The IRS has agreed to take that course.

The IRS says it has suspended the mailing of three notices — the CP501, the CP503 and the CP504 — that go to taxpayers who have a balance due on their taxes. These are sent after a taxpayer has received an initial notice, the CP14, about an unpaid tax debt.

The IRS also repeated its earlier pledge to post the mailed paper payments that are eventually opened on the date that the Service received them, not the later dates that IRS employees opened and processed them.

However, some of the errant notices are likely to make it through despite the IRS’ decision. “As the IRS works to stop these mailings at our processing centers, some taxpayers and tax professionals may still receive these notices during the next few weeks due to delivery of existing mailings,” noted the IRS.
if you were alerted to overdue taxes by an earlier notice and have not paid, you need to do so as soon as possible. The IRS stated, “taxpayers who have received but not yet responded to a CP14 balance due notice are encouraged to promptly respond.” If you don’t, once the IRS has worked its way through the old mail, you will get a correctly issued follow-up tax due notice, and you will owe the penalties and interested listed.