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CP295 notice: what it means and what to do
Got an IRS CP295 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 CP295 notice freeWhat the IRS says this notice is about
We previously charged you a penalty for filing a late or incomplete Form 5500, Annual Return/Report of Employee Benefit Plan, but we didn’t receive a reply from you.
What you need to do
- Pay the amount due electronically or by mail to avoid additional penalty and interest charges.
- If sending your payment by mail, use the address shown on your notice. Write your employer ID number, plan number, type of plan, plan year ending date, and form number on your payment.
- If your return was incomplete, you must provide the missing or incomplete information.
- Fax your information to 877-792-2864. (Protect yourself when sending digital data by understanding the fax service’s privacy and security policies.)
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
You may be able to remove the penalties
If you had no penalties in the 3 tax years before, filed all required returns, and paid or arranged to pay the tax, the IRS First-Time Abatement policy can remove failure-to-file and failure-to-pay penalties. You can ask in writing or by phone.
Cannot pay it all now? Ask for a payment plan
You can apply for a payment plan on irs.gov. Interest keeps running until the balance is paid, so pay what you can now.
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
- If you can’t pay the full amount due, pay as much as you can now to avoid added interest.
- Request a payment plan , if you can’t pay the full amount you owe.
Additional penalties and interest will accrue.
- You can send a signed statement and request removal of the penalty, if you have an acceptable reason why your return was late or incomplete. Identify which penalty you want reconsidered and why. We'll review the information and let you know in approximately 45 days if we accept your explanation.
- You must provide any missing or incomplete information.
- You can mail a signed Form 843 PDF and submit it with your missing or incomplete information to the address on your notice; or
- Fax your reasonable cause statement and missing information to 877-792-2864. (Protect yourself when sending digital data by understanding the fax service’s privacy and security policies.
Helpful information
- Publication 594, The IRS Collection Process PDF
- Where to File - Tax Exempt and Government Entities
Tips for next time you file
The IRS, Department of Labor , and Pension Benefit Guaranty Corporation jointly developed the Form 5500-series returns for employee benefit plans to satisfy annual reporting requirements under ERISA and the Internal Revenue Code.
Plan sponsors must generally file the return on the last day of the seventh month after their plan year ends. For more information, visit Form 5500 Corner .
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