Understanding your LT38 notice

What this notice is about

If you received a LT38 notice, it's letting you know that during the pandemic some collection notices were suspended. However, we're resuming normal operations and providing you with an update on your outstanding balance to help you stay informed and offer you self-service options to resolve your account. This isn't an audit.

It's always in your best interest to pay in full as soon as you can to minimize interest and penalties. The IRS has information and options available to help you meet and understand your tax responsibilities.

Questions about your LT38 letter?

Chat with us now - we're available online:

Monday-Friday: 8 a.m.-10 p.m. Eastern time/5 a.m.-7 p.m. Pacific time

Saturday-Sunday: Unavailable

Chat now

What you need to do

  • Read your notice carefully: Follow the instructions on your notice.
  • File missing tax returns (if any): If your notice indicates you have missing tax returns, file the missing returns as soon as possible. See frequently asked questions below for more information on how to file your return.
  • Pay your unpaid balance: Interest and applicable penalties will stop accruing as soon as you pay your balance in full. You can quickly and easily pay your balance online. See Your Online Account to learn how to determine your balance.
  • If you can't pay the balance due: and you're current with your filing obligations: See the frequently asked questions below.

Frequently asked questions

What if I can't pay the balance in full? (added January 2, 2024)

Pay what you can now; any payments will reduce the amount of interest and applicable penalties added to the remaining balance in the future.

You can enter into a payment plan to pay any remaining balance on your account over time.

If you owe less than $50,000, you may be able to set up an installment agreement using the Online Payment Agreement tool, which is the fastest way to get an installment agreement approved. If you can't apply online, call us at the toll-free number on your notice, or mail in a payment planPDF request.

If you've already submitted a payment or set up a payment plan

Payments on your balance can take up to 21 days to post on your account. If you paid your balance in full within the last 21 days, please disregard the LT38 you received.

If you already have an approved payment plan, then continue making payments per that agreement. If you've applied for a payment plan, but haven't yet been approved, pay as much of your balance as you can now to minimize additional interest and applicable penalties added to your balance.

If you're experiencing a financial hardship

In some circumstances, we may determine that you can't pay any of your tax debt. In these cases, we can report your account as currently not collectible to temporarily delay collection until your financial condition improves. Putting your account in currently not collectible status doesn't stop penalties and interest from being charged and it doesn't mean the debt goes away - it means the IRS has determined you can't afford to pay the debt at this time.

If you believe collection should temporarily be delayed on your account, please contact us and be ready to discuss your income, expenses, and owned assets. We may request proof of your financial hardship.

Under certain circumstances, an offer in compromise allows you to settle your tax debt for less than the full amount you owe. This may be a legitimate option if you can't pay your full tax liability, or doing so creates a financial hardship. Access the Offer in Compromise Pre-qualifier tool to see if you qualify for an offer in compromise.

Penalties and interest

In general, we charge penalties on your account when you don't pay your tax in full by the return due date (usually April 15), or if you've not made sufficient estimated tax payments (if required). For more information on penalties, see Penalties.

Due to the temporary suspension on issuing some collection notices, the Internal Revenue Service automatically granted penalty relief of certain failure to pay penalties for individuals and businesses on tax years 2020 and 2021. If you were assessed taxes of less than $100,000, the balance reflected on your letter for these tax years includes the automatic failure to pay penalty relief. If you're due a refund based on the automatic penalty relief, you should have received an IRS notice (CP21 or CP210) explaining the adjustment. Please disregard the language in the penalty relief notice stating the adjustment was based on information you provided to us; the adjustment was based on the information above.

If you were assessed tax of $100,000 or more on these tax years, you may still qualify for relief of certain failure to pay penalties. Refer to relief from penalties and follow the guidance outlined in the How to request penalty relief section.

Interest on the total amount you owe generally begins being charged daily from the return due date. For more information on interest, see Interest.

Filing your missing returns

How do I file my missing returns? (added January 2, 2024)

Read your notice carefully to identify which tax returns are missing from IRS records. You may need to file returns from multiple tax years.

You can find answers to many of your questions and get help preparing your return at Filing your taxes.

What if I already filed a return reported as missing? (added January 2, 2024)

If it's been over 10 weeks since you sent us the return, send a signed copy of it to us again. If you find that one or more of your returns were incorrectly reported as missing, please contact us using the toll-free phone number on your notice.

Based on my income do I need to file? (added January 2, 2024)

Use the Do I need to file a tax return? tool to verify that you don't meet the filing requirements for the tax years involved. If the tool indicates you're not required to file a return, but the notice indicates you're, please call the toll-free number on your notice.

What if I'm due a refund? (added January 2, 2024)

Based on your income and other factors, you may still be required to file even if you're due a refund. Also, to receive the refund, you must file a tax return within 3 years of the original return due date, or within 2 years of the date you full paid the tax, if applicable.

Special circumstances

Victim of fraud or identity theft

If you're a victim of fraud or identity theft, see  Taxpayer guide to identity theft .

Innocent spouse

In certain cases, a spouse will be relieved of the tax, interest, and penalties on a joint tax return. Learn more about innocent spouses.

Other circumstances

In most instances, information about your type of circumstance is available online. Use the search box in the top right of this web page to find more information. If you can't find the answers online, please call the toll-free phone number on your notice.

Need help?