CP515 Notice: First Notice of Unfiled Return

The CP515 Notice is issued by the IRS as a first notice regarding an unfiled tax return. This initial notice is sent when the IRS has determined that a taxpayer was required to file a return but has not yet done so. The CP515 is intended as a gentle reminder, giving taxpayers the opportunity to file before additional penalties and enforcement actions are applied.

Key elements of IRS CP515 Notice include:

1. Explanation of the Missing Return
   The CP515 Notice specifies the tax year and type of return that the IRS believes is missing. Common unfiled returns include personal income tax (Form 1040), corporate tax returns, or information returns for entities.
2. Consequences of Not Filing
   The CP515 warns taxpayers of the penalties and interest that may accrue if the return is not filed. Potential consequences include:
   • Failure-to-file penalty: A penalty based on the amount of taxes owed, which increases monthly until the return is submitted.
   • Substitute return filing: If the taxpayer does not file, the IRS may file a substitute return based on third-party information, which may not include deductions or credits the taxpayer is eligible for.
3. Filing Instructions
   The CP515 Notice includes directions for filing the missing return, including applicable deadlines and how to avoid penalties. The notice may suggest e-filing or mailing the return to a specific IRS office to expedite the process.
4. Options for Dispute
   Taxpayers who believe they are not required to file for the specified tax year can contact the IRS to dispute the notice. Supporting documentation may be necessary to clarify their filing obligations.
5. Importance to Tax Debt Resolution
   Responding to the CP515 Notice is essential for taxpayers to avoid penalties that contribute to tax debt. Filing the missing return promptly also helps taxpayers maintain compliance, preventing additional enforcement actions. Addressing unfiled returns is an important first step in tax debt resolution, as it demonstrates good faith and can prevent further interest and penalties from accruing.

The CP515 Notice serves as a proactive reminder for taxpayers to fulfill their filing obligations, reducing the risk of penalties and further debt accumulation.