IRS notice decoder
IRS Notice CP71: your annual reminder of a balance due
A CP71 is the annual reminder the IRS is required to send while a balance stays unpaid. It restates the tax, penalties, and interest owed as of the notice date. It is a reminder, not a new demand or a new enforcement step. The variants matter: CP71A reminds you while your account is in currently not collectible status, while CP71C and CP71D add a warning that a seriously delinquent balance can affect your passport.
General information, not tax or legal advice. Deadlines and dollar figures below reflect what the IRS publishes and can change; the controlling dates are the ones printed on your own notice. ClearChoiceRadar is not affiliated with the IRS or any government agency.
Where an annual reminder fits
Why you got it
You have an unpaid balance on a tax account, and the law requires the IRS to send a periodic reminder of it. A CP71 restates what you owe as of the notice date and asks you to pay or make arrangements. It does not mean anything new has happened on your account.
The reason code on the letter tells you more. CP71A is the reminder sent while an account sits in currently not collectible hardship status. CP71C and CP71D are reminders that also warn the IRS may file a lien, may assign the account to a private collection agency, and that a seriously delinquent balance can lead the State Department to deny or revoke a passport.
A reminder does not pause the balance
- Late payment penalty
- 0.5% of the unpaid tax per month or part of a month, up to a cap of 25%
- Interest
- accrues after the original due date and compounds until the balance is paid in full
- Refund offsets
- future federal, and sometimes state, tax refunds can be applied to the debt
The reminder itself changes none of this. Only payment, or an approved plan that cuts the monthly penalty rate in half, changes the math. Interest rates reset quarterly and are built into our IRS penalty and interest calculator.
What it does not mean
A CP71 does not restart collection or reset any deadline
It is a statement of the balance, not a step in the collection sequence. It does not extend the time the IRS has to collect and it does not create a new appeal window. What it signals is that the balance is still there and still growing, which is the reason to deal with it rather than file it away for another year.
Three honest ways forward
You can pay it
Pay the balance in full and the reminders stop. Interest stops once the balance reaches zero.
You can pay monthly
An installment agreement stops the yearly reminders from turning into enforcement, and the late payment penalty rate drops by half while an approved plan is in effect.
How IRS payment plans work →You genuinely cannot pay
Currently not collectible status and the Offer in Compromise exist for real hardship. A CP71A means you are already in that status; keep filing on time.
How Currently Not Collectible works →CP71 questions
Is a CP71 notice serious?
It is a reminder, not a new enforcement action, so on its own it is not urgent. But it means a real balance is still unpaid and still growing through penalties and interest, and the CP71C and CP71D versions warn that a lien, a private collection agency, or a passport problem can follow if the debt keeps building.
Why did I get a CP71 if I am in currently not collectible status?
That is the CP71A version. The IRS still sends an annual reminder of the balance while your account is in hardship status. If your finances have not improved, you generally do not need to do anything except keep filing your returns on time.
What is the difference between CP71C and CP71A?
CP71A reminds you of a balance while your account is currently not collectible. CP71C and CP71D remind you of a balance that is being actively collected and add the warning that the debt could lead to a lien, a private collection agency, or a passport denial or revocation if it becomes seriously delinquent.
Does a CP71 restart the IRS collection clock?
No. It is a reminder of an existing balance, not a new action, so it does not restart or extend the time the IRS has to collect and it does not create a new deadline. The balance simply continues to accrue penalties and interest.
Sources: IRS: Understanding your CP71 notice, IRS: Understanding your CP71C notice, IRS: Failure to pay penalty. The deadline that governs your case is the one printed on your notice.
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