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Question

CA taxpayers with extended due dates getting CP14s for unpaid taxes

Forum|Forum|3 years ago
June 5, 2023
6 replies
48 views

Anyone else seeing their CA clients getting bills from IRS even though we have an extended due date?

These CP14 notices dont have any interest/penalty computed on them from April to June, but state they need to be paid in June to avoid penalty/interest.

I've got 8 voicemails on my cell since last week, Im not back in the office until tomorrow, whatcha wanna bet theyre all about these stupid notices! argh!

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sjrcpa

Level 15

What fun!

The more I know the more I don’t know.

rbynaker

Level 13

I've seen similar posts on other lists. Someone posted on another list that CalCPA is addressing the issue and WSJ is working on an article.

Just-Lisa-Now-

Author

Intuit Community Champion

gonna be a looong week!

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

rbynaker

Level 13

@Just-Lisa-Now- wrote:

gonna be a looong week!

So much for "The IRS computers will automatically grant relief based on the zip code."

BobKamman

Level 15

"If an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date that falls within the postponement period, the taxpayer should call the telephone number on the notice to have the IRS abate the penalty."

https://www.irs.gov/newsroom/irs-announces-tax-relief-for-victims-of-severe-winter-storms-flooding-and-mudslides-in-california

Update: Congress repealed the funds IRS needs to answer the phones. Call Kevin McCarthy's office instead.

P

ptax255

Level 6

Same issue. How is everyone responding to the notice? Or not respond at all and wait for the IRS to acknowledge the mistake (wishful thinking)

Just-Lisa-Now-

Author

Intuit Community Champion

Im not responding to those notices. Im telling my clients they still have until October to make payment.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

BobKamman

Level 15

I checked to see if Spidell had reported anything about this. All I found was an item from May, about CP14's being sent nationwide for previous years.

https://www.caltax.com/news/hot-news-and-notes/irs-to-send-out-millions-of-balance-due-notices-starting-this-month/

So it might be a good idea to ask clients if the notice relates to 2022.

abctax55

Level 15

I deliberately did not file any returns with a balance due as my crystal ball said this would be an issue 😉 so none of my clients have received notices.

I did find this on a different list-serve:

Notice 1155-G is included with the CP-14 Notice.

Disaster Relief from the IRS

The Federal Emergency Management Agency (FEMA) recently issued a disaster declaration. The IRS announced that taxpayers

in your area may quality for administrative disaster tax relief Administrative disaster tax relief generally includes postponement of

most filing and payment deadlines. lf your IRS address of record is in the covered disaster area listed in the news release, you will

automatically receive IRS administrative disaster tax relief. Visit www.irs.gov and search "lRS News From Around the Nation" to view

the news release.

But it's in a much smaller font, looks like "junk mail," and the clients don't read it.

So tell your clients to read the fine print and ignore the CP-14 notice.

Edit... and more:

I’ve had several clients receive the notices as well. Filing extensions doesn’t prevent this, since it’s auto generated when a return with balance due is filed yet payment has not been made. We called the IRS disaster hotline, and they confirmed disaster relief applies to postpone the payments until 10/16 and no interest/penalties will be assessed.

They said we could get a POA and call to have the notices temporarily stop, but only for 9 weeks… which is useless. My firm has decided to ignore the notices and assure clients they still have until 10/16 to pay without interest or penalties. We’re also giving them a heads up that they may continue to receive these automatic notices in the meantime.

I’ve reached out to my local IRS stakeholder liaison, and they are aware of the issue and considering escalating internally. I’ve asked them to confirm that the accounts won’t get kicked into collections in the meantime if we don’t respond.

The liaison asked for a few copies of the notices so they can see what is being communicated and what they are instructing taxpayers to do on them. I sent to them, but it’s really just a notice that there’s a balance due that hasn’t been paid and a request to pay by a certain date. One client did also scan the insert that Gina mentioned, indicating disaster relief may apply. However, the notices really could be a lot more clear and say that if disaster relief applies, ignore the notice. I’m not confident their system is equipped to suspend these notices though.

Just a bit more background for anyone interested:

The liaison shared that for the CA storm relief, the applicable code they use to suspend interest and penalties on accounts is “S” and not “O” and provided the following distinctions:

“IRM –

3.14.2.7.6.19 Disaster Freeze (-S) Notice Review - The -S freeze is a systemic disaster indicator that gives the IRS flexibility to grant filing and payment relief without suspending compliance activities and thegeneration of notices when the impact and scope of a federally declared disaster does NOT warrant the use of the -O Freeze.
IRM -

3.14.2.7.6.14 - Disaster Freeze (-O) - The -O freeze allows the Service to provide special processing related to any filing, payment or interest relief, granted for a geographical area. It is input systemically at the request of the Disaster Program Office.

· IRM -

3.14.2.7.4.4 - Natural Disaster Procedures - Notice Suppression - The Disaster Relief Memorandum identifies the covered disaster area (zip codes) and the beginning and ending dates for notice suppression and/or stuffer requirements. If systemic notice suppression is established by an - O Freeze, no further action is required to suppress notices.

The S freeze will not suspend notices but O freeze does. The IRMs still do not answer to your question of whether to disregard/ignore the notice until 10/16^th. This question is too specific. IRS cannot provide an answer.

Please call the disaster line to ask instead.”

HumanKind... Be Both

abctax55

Level 15

Flash Alert from Spidell:

IRS tweets apology for erroneous CP14s (06-08-23)

In tweets released late yesterday, the IRS stated that California taxpayers who qualify for the disaster-related October 16 postponements (August 15 for Modoc and Shasta counties) still have until the October 16/August 15 postponement deadline to pay their 2022 tax liabilities. The IRS stated that taxpayers receiving erroneous CP14 letters do not need to call the IRS or their tax professionals.

The IRS acknowledged that the CP14s are automatically generated when taxpayers have a balance due, but that taxpayers eligible for the disaster postponements do not have any balances currently due. From the IRS’s tweets: “The IRS apologizes to taxpayers and tax professionals for any confusion as we continue to review the situation.”

The tweet thread is available at:

https://go.spidell.com/e/837113/ews-status-1666592802724261888/5vbl3m/1535035272?h=IEA4j5W9Y2aIv71g1IQ50tq_Y-5iygODUdoh07ghl6Q

HumanKind... Be Both

BobKamman

Level 15

They asked me how I knew my tax debt was true
I, of course replied
"A CP14 cannot be denied"
They said, "Someday, you'll find some tax collectors are blind
When Canadian forests are on fire
You must realize smoke gets in IRS eyes"
So, I chaffed them, and I gaily laughed
To think they could doubt my bill
Yet, today, my IRS demand has flown away
I am without my urgent debt (without my deadline to pay)
Now, laughing friends delight in tears of joy I cannot hide
So I smile and say
"When Canadian smoke reaches DC
Smoke gets in their eyes"

· IRM -

The S freeze will not suspend notices but O freeze does. The IRMs still do not answer to your question of whether to disregard/ignore the notice until 10/16th. This question is too specific. IRS cannot provide an answer.

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The S freeze will not suspend notices but O freeze does. The IRMs still do not answer to your question of whether to disregard/ignore the notice until 10/16^th. This question is too specific. IRS cannot provide an answer.