Collection Due Process (CDP)

A Collection Due Process hearing, or CDP hearing, is your right to challenge an IRS levy before it happens, or a federal tax lien after the IRS files public notice of it. Under Internal Revenue Code Sections 6320 and 6330, a taxpayer who receives a Final Notice of Intent to Levy or a Notice of Federal Tax Lien can request a hearing that stops or delays enforcement while the IRS Independent Office of Appeals reviews the case.

The goal is to prevent unjust collection and to surface options such as an installment agreement or an offer in compromise before the IRS seizes wages, levies a bank account, or places a lien. Once the notice arrives, a taxpayer generally has 30 days to request a hearing. Missing that window leaves only limited appeal rights.

What a CDP hearing can raise

At the hearing, a taxpayer can raise defenses such as an improper assessment, errors in the IRS's calculations, or a collection action that would create undue hardship. Alternatives can also be proposed, including an installment agreement, an offer in compromise, or a hardship deferral. The hearing is often the best remaining opportunity to stop or delay collection while a fair resolution is pursued.

Requesting a hearing

1. File IRS Form 12153 and select the grounds for the request, such as a challenge to the debt's validity, a proposed alternative agreement, or a request for spousal relief.
2. Mail the request to the correct IRS office and document everything sent.
3. Once filed, the IRS suspends collection activity and transfers the case to the Office of Appeals, which is separate from the collection division to preserve impartiality.
4. An appeals officer reviews the case and rules to uphold the collection action, halt it, or accept a payment plan or offer in compromise.

Building the record

Because the outcome depends heavily on the administrative record, the useful work happens before the ruling: confirming that all statutory notices were properly issued, that the taxpayer had an adequate opportunity to respond, and that the underlying assessment was accurate. Procedural violations found in that review become leverage in negotiation or on appeal.

If the hearing does not go your way

An unfavorable ruling is not the end of the matter. A taxpayer can petition the U.S. Tax Court within 30 days for judicial review, a time-sensitive step that permanently forecloses the challenge if missed. Short of that, requesting reconsideration or proposing a new resolution, such as an installment agreement in place of a denied offer in compromise, can still move the case forward.

Beyond CDP hearings, Whiteford Tax Defense handles the administrative appeals that often precede one, and represents clients in U.S. District Court when a collection dispute proceeds beyond the Tax Court.