IRS 4464C Letters and CP05 Notices make taxpayers confused.

Did you receive a 4464C Letter or CP05 Notice from the IRS? A lot of taxpayers are waiting on their tax refund. Instead of a direct deposit, they are stuck looking at the message “…still processing…” on the IRS Where’s My Refund tool after 21 days has passed since they filed their return. Some have been met with notices to “Take Action” accompanied by a Reference Code such at 1121 or 1541 instructing them to call the IRS.  But they are not getting good answers from call center representatives.

When you call the IRS people are sometimes told that their “tax return is being reviewed.”  Oftentimes they are told to just wait another 60 days, 45 days and to expect a letter in the mail. Without any descriptive answer from the IRS, people have been turning to their Account Transcripts staring at Transaction Codes 570 and 971, again with minimal description.  The codes are confusing because they are post dated.  And that mail may or may not eventually arrive which is only slightly more helpful. For example, someone who viewed their Account Transcript on February 16th found Transaction Code 971 that says “Notice Sent” March 12th. One asks, how that is possible? March 12th is nearly 30 days away? And when the mail never comes, they become increasingly frustrated.  Fast forward and our users are now reporting that they are finally receiving the 4464C Letter and/or the CP05 Notice telling them to wait another 45-60 days. These again indicate that their return is under review or that their refund is being held without describing what specifically is being reviewed or why. They are left still without a definite answer as to why they must wait nearly 3 months for a tax refund when others are receiving them in 7-10 days. Our users are pissed off.  So we are trying to help you piece this all together.

4464C Letter

Searching the IRS website gives you just about nothing about a 4464C Letter.  Although, it is plastered all over the Internal Revenue Manual (IRM). Below is what we turned up about the 4464C Letter.

When will I receive the 4464C letter from the IRS?
Why have I not received it?  When is it sent? The customer service representatives will likely tell you different answers depending on which one you talk to.  We are almost certain they are trained monkeys. If you are looking at your IRS Account Transcript we think this letter is related to the 570 Transaction code.  Although the 570 code may have been placed in January or February, it could have a future posting date on that particular line. We talked to the Taxpayer Advocate Service (TAS) and they told us that is the date when the IRS expects to have sent you the letter. They said taxpayers should allow 1-2 weeks from the date posted (not the date you saw it on your account, but the date on the 570 line item) to receive the letter.  So if you haven’t received your refund and you are anxious to know why, you can start stalking your mailbox on or about the date that is shown on the 570 line, rather than when you saw that the 570 appear on your account transcript.

Why am I getting the 4464C letter from the IRS?
Simply put, your tax return is under review. This is not an audit notice. The review is part of a normal revenue protection program by the IRS. The IRS selects returns for review using various methods which include random sampling, computerized screening, and comparison of information received by the IRS such as Forms W-2 and 1099.  The letter will indicate that they are reviewing your return for one or more of the following:

• Income you reported on your return
• Income tax withholding amounts
• Claims for tax credits
• Business Income

At the IRS, it is known as the Questionable Refund 3rd Party Notification Letter.  It is sent from the Integrity & Verification Operations unit at the IRS. It signals to the taxpayer that the IRS may contact other parties such as your employer to verify information you reported on your return.

What should I do?
Nothing.  It’s not time to call (unless you didn’t file a tax return.)  If you receive a 4464C Letter from the IRS, you aren’t required to do anything. The letter indicates that if you haven’t received your refund or been contacted by the IRS in writing within 60 days from the date of the letter you can call for more information.  The letter also tells you what to do if you received it and didn’t file a tax return.

CP05 Notice

The CP05 notice is very similar and nearly identical to the 4464C Letter with only slight differences. On the IRS website you will find information about the CP05 Notice.  We are going to sum up what we found and when you can expect the CP05.

When will I receive the CP05 Notice from the IRS?
Just like the 4664C Letter, you may have simply been told by a customer service representative that “something” is coming to you by mail.  If it is a CP05 Notice, we think it might be related to Transaction Code 971 posted to your account.  Transaction Code 971 does indeed have the description “Notice Sent”, but doesn’t clarify which notice.  So there may be other Transaction Codes associated with 971 and you might get other notices such as a CP05A, CP05B, CP05C.  Just like the 4464C dates above, we think the same rule of thumb applies to the CP05 Notice. Although the 971 code may have been placed in January or February, it could have a future posting date on that particular line. Taxpayers should allow 1-2 weeks from the date posted (not the date you saw it on your account, but the date on the 971 line item) to receive the letter.  So if you haven’t received your refund and you are anxious to know why, you can start stalking your mailbox on or about the date that is shown on the 971 line, rather than when you saw that the 971 appeared on your account transcript.

Why am I getting the CP05 Notice from the IRS?
Simply put, your tax refund is being held. This is not an audit notice. They will review your return before releasing a refund. The review is part of a normal revenue protection program by the IRS. The IRS selects returns for review using various methods which include random sampling, computerized screening, and comparison of information received by the IRS such as Forms W-2 and 1099.  The letter will indicate that they are reviewing your return for one or more of the following:

• Income you reported on your return
• Income tax withholding amounts
• Claims for tax credits
• Social Security benefits withholding amounts
• Household Help
• Schedule C Income

What should I do?
Again, nothing.  It’s not time to call (unless you didn’t file a tax return.)  If you receive a CP05 Notice from the IRS, you aren’t required to do anything. The notice indicates when they anticipate that the review will be completed and provides you with that date which is 45 days from the date of the letter.  For instance, if the notice is dated March 12th, 45 days from that date is April 26th. It says you will receive a refund or another notice from the IRS. Again, the letter also tells you what to do if you received it and didn’t file a tax return.

CP05A, CP05B, 4115C Notice

As more time passes you may receive another letter in the form of a CP05A, CP05B, or 4115C that requests a response from you. We will write more about these notices in the next post.

Your Turn

• Join us to ask questions in our live discussion or post in the forum to discuss your 4464C Letter or CP05 Notice
• Search our site to see what others are saying:  about 4464C and CP05 on our site.
• Our forum has an area for more IRS letters and notices.