IRS Notice CP91 warns you that the IRS is about to take up to 15% of your Social Security benefits because you have unpaid taxes. If you want to keep your benefits, you must take urgent action.
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Why does the IRS send Notice CP91?
If you’re receiving a CP91 notice, you have a federal tax debt.
You may not have paid your federal taxes when you filed, or the IRS may have previously adjusted your tax returns.
You should have already received multiple notices from the IRS explaining your outstanding debts and any changes to your tax returns.
Your CP91 notice should contain a summary of the tax years you owe for plus the penalties and interest that apply.
What should you do next?
If you don’t take action by the notice deadline, the IRS will begin taking up to 15% of your monthly Social Security benefits. This will continue until your tax debt is paid off.
If you believe the amount you owe is correct, you may want to request a payment plan. A payment plan allows you to create a payment schedule that may be more manageable and will often have lower penalties. The IRS generally won’t take your Social Security income if you’re approved for a payment plan and pay as agreed.
If you have savings but not enough to pay in full and 15% of your Social Security payment won’t be enough to pay off your tax debt within a reasonable time, you may also want to look into an offer in compromise. An offer in compromise allows you to make a one-time payment for less than what you owe, and you don’t have to pay the remaining about.
What if you don’t agree with what you owe?
There are several reasons you may not agree with what you owe.
If you believe your account balance is incorrect, you may want to call the IRS. For example, they may not have applied a payment you made, and you will need to ask them to trace it.
If you disagree with the IRS changing your tax return, it can get more complicated. Generally, you should have already received a notice of audit or proposed changes. If you missed the deadline to appeal the changes, contact a tax professional to find out if you have any remaining options.
If you can’t afford to hire someone to help you, you may be eligible for a Low Income Taxpayer Clinic.
Can the IRS still garnish your wages or bank account or seize other property?
A CP91 notice doesn’t mean that the IRS will only garnish your Social Security.
They may also garnish wages, take money from your bank account, or seize other property. You should receive a separate notice regarding that.
Because the IRS may take other collection action, it’s generally not a good idea to just let them take your Social Security. The better thing to do is to contact them to make payment arrangements.