The CP71 shows up once a year, every year, until your balance is paid or the collection statute expires. It's the IRS's annual reminder that you owe money. The letter shows your current balance including accumulated penalties and interest.
Most people toss the CP71 in a drawer because it looks like junk mail they've seen before. That's a mistake. The CP71 contains a number that most taxpayers don't know to look for: clues about your Collection Statute Expiration Date.
Why the CP71 Matters Strategically
The IRS has 10 years from the date of assessment to collect a tax debt. After that, the debt expires. The CP71 arrives annually, which means it's your annual opportunity to track whether the CSED is approaching. If your original assessment was in 2017 and you're receiving a CP71 in 2026, you're potentially one year away from expiration on that period.
Understanding where you stand relative to the CSED changes everything about your resolution strategy. If the statute expires in 18 months and you owe $40,000, making payments might not make sense. If the statute has 8 years left, an installment agreement or offer in compromise might be the better path.
CP71 vs. CP71A vs. CP71C
The CP71A is the same annual reminder but with more detail about payment options. The CP71C is sent to taxpayers in Currently Not Collectible status. If you're receiving CP71C notices, the IRS has determined you can't pay right now, but they're reminding you the debt still exists and they'll review your situation periodically.
Currently Not Collectible status is not permanent. The IRS reviews CNC accounts periodically and can pull you out of CNC if your income increases. The CP71C is a reminder of that reality.
What to Do
Don't ignore it. Review the balance. Compare it to prior years to see how penalties and interest are growing. If you're in a position to resolve the balance, this is a good time to evaluate your options. If you're waiting for the CSED to expire, verify your calculation against your account transcript.
If you've been receiving CP71 notices for years and want to know when the statute expires, call us at (813) 229-7100. We can pull your transcripts and calculate your exact CSED.