TSCPA News

IRS Issues Update Regarding Pending Check Payments and Notices

August 19, 2020

The IRS has issued an update regarding its backlog in processing mail and payments due to COVID-19. It has stated the computer-generated notices that do not accurately reflect taxpayers’ payments and accounts that have been sent to taxpayers were sent due to the processing backlog. Also, checks that were mailed to the IRS, sent with or without a tax return, may still be unopened due to the backlog.

Any payments will be posted as the date the IRS received them rather than the date they were processed. To avoid penalties and interest, taxpayers should not cancel their checks. To provide fair and equitable treatment, the IRS is providing relief from bad check penalties for dishonored checks received between March 1 and July 15 due to delays in IRS processing. However, interest and penalties may still apply.

Due to high call volumes, the IRS suggests waiting to contact the agency about any unprocessed paper payments still pending. See www.irs.gov/payments for other payment options.

Aug. 21 update: The IRS has temporarily suspended the mailing of three notices – the CP-501, the CP-503 and the CP-504 – that go to taxpayers who have a balance due on their taxes. The IRS is taking the step to avoid confusion for taxpayers who previously received a balance due notice (CP-14) and mailed a payment to the IRS. Those payments may still be unopened due to the COVID-19 processing backlog. The IRS will continue to assess the mail inventory to determine the appropriate time to resume the follow-up notices and encourages taxpayers who have received but not yet responded to a CP-14 balance due notice to promptly respond.