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CP137A notice: what it means and what to do
Got an IRS CP137A notice? Here is what it means, your deadline, what to check before you answer, and how to reply. Check your own letter free: it stays on your phone.
Check my CP137A notice freeWhat the IRS says this notice is about
Next year, the deposit requirements for your Form CT-1, Employer's Annual Railroad Retirement Tax Return , are changing based on your tax from last year’s Form CT-1. CP137A shows what your new deposit requirements will be.
What you need to do
- If your tax liability for last year was $50,000 or less, you are a monthly depositor next year. Monthly depositors must deposit taxes for wages paid during a month by the 15th day of the following month.
- If your tax liability for last year was over $50,000, you are a semi-weekly depositor next year. Semi-weekly depositors must deposit taxes as explained below: For wages paid on Saturday, Sunday, Monday, or Tuesday, you must deposit taxes by the following Friday.
- For wages paid on Wednesday, Thursday, or Friday, you must deposit taxes by the following Wednesday.
- Check your records to determine if they agree with the liability amount shown on CP137A. If the amount we used differs from your tax records, then you must determine and follow the appropriate deposit schedule.
- If the tax amount we used is zero, then you may need to file last year's Form CT-1 . If you’re not required to file, or you already filed a Form CT-1 that did not show any tax, then no action is needed.
Your deadline
Answer by the date printed on your notice. If there is no date, answer as soon as you can, and call the number on the notice if you need more time.
What to check before you answer
Is this letter really from the IRS?
The IRS writes first by mail. A real letter shows a notice or letter number, your name and part of your tax ID number. The IRS does not ask for payment by gift card, crypto or wire transfer. If in doubt, sign in to your IRS online account, where many notices are listed.
Common questions
How do I show my payments when I file Form CT-1?
We have a record of your payments. On Form CT-1, show the tax liabilities, not your payments.
How do I show the tax liabilities?
If you are a monthly depositor, enter the Tier 1 and Tier 2 taxes due for each month on Form CT-1, Part II. If you are a semi-weekly depositor, use Form 945-A, Annual Record of Federal Tax Liability PDF , to enter the tax due for each date you paid your employees.
What do I do if the tax liability on the notice is incorrect?
The tax on the notice includes only the tax liability on your original Form CT-1 for last year. Don't include amended returns. Base your deposit requirements on the original tax liability.
Do I have to pay electronically? (updated Mar. 12, 2026)
You must pay all deposits electronically, unless your tax liability is less than $2,500. If your tax for the year is less than $2,500, you can pay with Form CT-1(V), Payment Voucher. The payment voucher is attached to Form CT-1 PDF .
To enroll or find more information on how to pay electronically, see EFTPS: The Electronic Federal Tax Payment System
What if my accumulated tax liability reaches $100,000?
You must deposit the next business day. You immediately become a semi-weekly depositor for the rest of the current year and the next year.
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