Understanding your LT16 Notice

What this notice is about

If you received a simple LT16 notice, it’s because we’re trying to collect unpaid taxes from you and/or our files show we’re missing tax returns from you.

It is essential that you take action in order to avoid potential enforcement action, which can include seizing your assets or wages. Enforcement action could also include the filing of a notice of federal tax lien, which could affect your credit score and ability to borrow. See a detailed explanation of what enforcement action may involve.

What you need to do to avoid enforcement action

• Read your notice carefully: Following the instructions on your notice may stop enforcement action.
• File missing tax returns (if any): If your notice indicates you have missing tax returns, file the missing returns as soon as possible. See Filing Your Taxes for more information on how to file your return.
• Pay your unpaid balance: Interest and applicable penalties will stop being added as soon as you pay your balance in full. You can quickly and easily pay your balance online. See View Your Tax Account to learn how to determine your balance.
• If you can’t pay the full amount due: Pay as much as you can now and set up an installment agreement for the remaining balance. You must be current on your filings in order to apply for an installment agreement.
• If you are currently facing financial hardship: There are options available to you. See below under If you’re experiencing a financial hardship.
• Your appeal rights: If the tax is in doubt, you dispute the amount of the tax, or can’t resolve a disagreement with us, you’re entitled to a hearing with the Office of Appeals. Please refer to Publication 1660, Collection Appeal Rights PDF; or visit Office of Appeals. You can also call the toll-free phone number on your notice.

Filing your missing returns

How do I file my missing returns?

Read your notice carefully to identify which tax returns are missing from IRS records. You may need to file returns from multiple tax years.

You can find answers to many of your questions and get help preparing your return at Filing Your Taxes.

What if I already filed a return reported as missing?

If it’s been over 10 weeks since you sent us the return, send a signed copy of it to us again. If you find that one or more of your returns were incorrectly reported as missing, please contact us using the toll-free phone number on your notice.

Based on my income I don't think I need to file

Use the Do I need to file a tax return? tool to verify that you do not meet the filing requirements for the tax years involved. If the tool indicates you’re not required to file a return, but the notice indicates you are, please call the toll-free number on your notice.

What if I'm due a refund?

Based on your income and other factors, you may still be required to file even if you’re due a refund. Also, to receive the refund, you must file a delinquent return within three years of the original return due date, or within two years of the date you full paid the tax, if applicable.

Paying your balance

Paying your balance in full will stop any enforcement action and may also prevent additional interest and applicable penalties from being added. You can pay easily online. See View Your Tax Account to learn how to determine your balance.

If you can't pay in full now

Pay what you can now; any payments will reduce the amount of interest and applicable penalties added to the remaining balance in the future.

You can enter into an installment agreement to pay any remaining balance on your account over time.

If you owe less than $50,000, you may be able to set up an installment agreement using the Online Payment Agreement tool, which is the fastest way to get an installment agreement approved. If you can’t apply online, call us at the toll-free number on your notice, or mail in a installment agreement PDF.

If you've already submitted a payment or established an installment agreement

Payments on your balance can take up to 21 days to post on your account. If you paid your balance in full within the last 21 days, please disregard the LT16 you received.

If you already have an approved installment agreement, then continue making payments per that agreement. If you’ve applied for an installment agreement, but haven’t yet been approved, pay as much of your balance as you can now to minimize additional interest and applicable penalties added to your balance.

If you are experiencing a financial hardship

In some circumstances, we may determine that you can’t pay any of your tax debt. In these cases, we can report your account as currently not collectible and temporarily delay collection until your financial condition improves. Putting your account in currently not collectible status does not stop penalties and interest from being charged and it does not mean the debt goes away; it means the IRS has determined you can’t afford to pay the debt at this time.

If you believe collection should temporarily be delayed on your account, please contact us and be ready to discuss your income, expenses, and owned assets. We may request proof of your financial hardship.

Under certain circumstances, an Offer in Compromise allows you to settle your tax debt for less than the full amount you owe. This may be a legitimate option if you can't pay your full tax liability, or doing so creates a financial hardship. Access the Offer In Compromise Pre-Qualifier Tool to see if you qualify for an offer in compromise.

Penalties and interest

In general, we charge penalties on your account when you don’t pay your tax in full by the return due date (usually April 15), or if you’ve not made sufficient estimated tax payments (if required). For more information on penalties, see Penalties.

Interest on the total amount you owe generally begins being charged daily from the return due date. For more information on interest, see Interest.

If you don’t pay in full (even if you have a pending or approved installment agreement) by the payment due date specified in any notice issued to you, additional interest and applicable penalties will continue to be added until you pay your balance in full.

You may qualify for relief from penalties if you made an effort to comply with the requirements of the law, but were unable to meet your tax obligations, due to circumstances beyond your control.

Special circumstances

Victim of fraud or identity theft

If you’re a victim of fraud or identity theft, see Taxpayer Guide to Identity Theft.

Innocent spouse

In certain cases, a spouse will be relieved of the tax, interest, and penalties on a joint tax return. Learn more about innocent spouses.

Other circumstances

In most instances, information about your type of circumstance is available online. Use the search box in the top right of this web page to find more information. If you can’t find the answers online, please call the toll-free phone number on your notice.

The Taxpayer Advocate

The Taxpayer Advocate Service (TAS) is an independent organization within the IRS that can help protect your taxpayer rights. TAS can offer you help if your tax problem is causing a hardship, or you've tried but haven't been able to resolve your problem with the IRS. If you qualify for TAS assistance, which is always free, TAS will do everything possible to help you. Visit the Taxpayer Advocate Service website or call 877-777-4778.

Assistance can be obtained from individuals and organizations that are independent from the IRS. Publication 4134, Low Income Taxpayer Clinic List PDF provides a listing of Low Income Taxpayer Clinics (LITCs). The information is also available in the Taxpayer Advocate Service’s LITC section. Assistance may also be available from a referral system operated by a state bar association, a state or local society of accountants or enrolled agents or another nonprofit tax professional organization. The decision to obtain assistance from any of these individuals and organizations will not result in the IRS giving preferential treatment in the handling of the issue, dispute or problem. You don’t need to seek assistance to contact us. We will be pleased to deal with you directly and help you resolve your situation.