IRS CP504 Notice — Intent to Levy State Refund
The IRS is signaling that levy action is next. Time to act.
The notice in plain English.
A CP504 (sometimes labeled CP504B for business taxpayers) is a Notice of Intent to Levy your state income tax refund. It also warns the IRS may search for other assets to levy.
Common triggers.
- Prior notices (CP14, CP501, CP503) went unanswered.
- An existing payment arrangement defaulted.
- The IRS escalated automatically through its collection cycle.
Your response window.
30 days from the notice date. After that, the IRS can levy your state refund and prepare further collection actions including wage garnishment and bank levies.
What happens next.
- Your state tax refund can be seized to pay the balance.
- The IRS may file a Notice of Federal Tax Lien against your property.
- Continued inaction triggers LT11 / Letter 1058 — the final notice before broader levy.
Your real options — in plain order.
Installment Agreement
Stops escalation and most levy action while in good standing.
Currently Not Collectible (CNC)
Pauses collection if paying creates real hardship.
Offer in Compromise (OIC)
Settle the debt for less than owed if you qualify financially.
Collection Due Process (CDP) hearing
Available after a final notice — preserves appeal rights.
Common mistakes.
- Calling the IRS yourself and agreeing to a payment you can't sustain.
- Waiting for the final notice to act — you lose options at each step.
- Ignoring the 30-day window. Every day inside it is leverage.
Questions about CP504.
Can the IRS levy my paycheck after a CP504?+
Not yet from this notice alone — wage garnishment generally requires a final notice (LT11/Letter 1058). But CP504 means that final notice is the next step if you don't act.
What's the difference between a lien and a levy?+
A lien is a legal claim on your property. A levy is the actual seizure. CP504 is intent to levy a state refund and warns that broader levy authority is being prepared.
Should I appeal?+
Often yes. A Collection Due Process or Collection Appeal Program request can pause collection while alternatives are negotiated.
Bring the notice. We'll handle it from here.
A 30-minute consultation with an Enrolled Agent is usually enough to know exactly which resolution path fits your situation.