Understanding Your CP254 Notice
Your organization submitted a paper return for the tax period in question. Because our records show that you must file electronically, the paper return doesn’t satisfy your filing obligation.
What you need to do
Determine if your organization has total assets of $10 million or more and files 250 returns in a calendar year.
- If yes, file the electronic return as soon as possible. If you fail to do so, you may be subject to a failure to file penalty.
- If no, respond to the CP254 notice explaining why you aren’t required to file electronically.
Answers to Common Questions
Which returns are included in the 250-return requirement?
You must count all information and tax returns, including, but not limited to:
- Form W-2
- Form 1099
- Form 720
- Form 941
- Form 944
- Form 990
- Form 990-EZ
- Form 990-N
- Form 990-PF
- Form 990-T
We can’t file electronically because our organization’s name changed, we filed for the first time, or we filed a short period return. What do we do now?
Respond to the notice with an explanation of the situation that kept you from filing electronically.
Our software won’t allow us to file electronically for the year indicated on the notice. What do we do now?
Call the phone number on the notice (1-877-767-2501) to determine what action you must take.
We tried to file electronically, but received a rejection notice. What do we do now?
Review the rejection notice to determine the reason the system couldn’t accept the return. Correct the return and resubmit it electronically.
Understanding your notice
Your notice may look different from the sample because the information contained in your notice is tailored to your situation.
Notice CP254, Page 1
Notice CP254, Page 2
Notice CP254, Page 3
Notice CP254, Page 4