IRS Notice CP15: Penalties, Contesting, and Relief Options

IRS Notice CP15 is a civil penalty notice: it tells you the IRS has assessed a specific penalty against you, states the amount, and gives you a date by which to pay or respond. It is not a recalculation of your tax return and it is not a misapplied-payment notice. It is a bill for a penalty, most often a trust fund recovery penalty tied to unpaid employment taxes or a penalty for failing to file an international information return. Interest starts running from the date on the notice, so the clock matters.

What the Notice Is Actually Saying

CP15 comes out of the IRS’s Civil Penalty Module and serves as the formal record that a penalty has been charged to your account.¹ The notice identifies the penalty type, the tax period, the dollar amount, a due date, and a phone number and address for the IRS unit handling your case.

There are two versions you are likely to see:

CP15 is the general civil penalty notice, used for a range of violations including international information return failures.
CP15B is specific to the trust fund recovery penalty, assessed against individuals personally responsible for unpaid employment or excise taxes.²

Because the notice is about a penalty rather than a tax adjustment, your response options are different from what you’d do with a routine correction letter, and many of these penalties carry no statutory cap.

The Penalties That Usually Trigger a CP15

Trust Fund Recovery Penalty

The trust fund recovery penalty is the most serious penalty delivered through this notice series. When a business withholds income tax, Social Security, and Medicare from employee paychecks, those amounts are held in trust for the government. If a responsible person willfully fails to pay them over, the IRS can assess a penalty equal to 100% of the unpaid trust fund amount against that person individually.³ It is not a percentage add-on; it equals the full amount that should have been paid over.

“Responsible person” is defined broadly and can include corporate officers, directors, shareholders with financial authority, partners, LLC members, and even bookkeepers or payroll providers who had the power to decide which creditors got paid.⁴ The IRS often assesses the same unpaid taxes against multiple people. Before issuing a CP15B, the IRS normally sends Letter 1153 proposing the penalty and giving you 60 days to appeal; if that window passed without a response, the CP15B is the formal assessment.

International Information Return Penalties

CP15 is also used to assess penalties for late or missing international information returns. These are assessed manually and flow through the Civil Penalty Module before the notice is sent.⁵ The most common forms behind these notices are Form 5471 (ownership in foreign corporations), Form 8938 (foreign financial assets), and Form 5472 (foreign-owned U.S. corporations). Base penalties start at $10,000 per failure for 5471 and 8938 and $25,000 for 5472, with continuation penalties that keep stacking every 30 days after a 90-day warning; 5472 has no cap.⁶

Many people who get these notices did not know they had a filing obligation, especially U.S. citizens living abroad and immigrants with accounts in their home countries.

Other Information Return Penalties

CP15 also appears for domestic information return violations, such as failures around Forms 1099 or W-2, when the penalty is assessed manually rather than through the automated Notice 972CG process.⁷

Read Your Notice Carefully Before Doing Anything Else

Start with the notice date and the payment due date near the top. Those control your timeline, and interest runs from the notice date. Then find the specific penalty type and the Internal Revenue Code section cited; that tells you which rules govern your options.

Check the penalty amount and the tax periods listed. For a trust fund recovery penalty, confirm the quarters shown correspond to periods when you actually had authority over the business’s finances. For international reporting penalties, confirm you actually had a filing obligation for each form and year listed. People sometimes receive CP15 notices for years after they had already divested from a foreign corporation or closed a foreign account.

Write down the phone number and mailing address for the IRS unit shown on the notice. Calling the general IRS line will just get you transferred; the unit contact on your notice reaches the people who actually have your file.

If You Agree with the Penalty

Pay by the due date on the notice. The IRS charges interest on unpaid penalty balances at 7% per year, compounded daily, as of early 2026.⁸ Interest accrues from the date of the notice until the balance is paid.²

You can pay online, by phone, or by mail using the voucher included with the notice. If you can’t pay all at once, you may be able to set up an installment agreement. Individual taxpayers who owe $50,000 or less in combined tax, penalties, and interest can apply for a long-term plan online. Above that, you’ll need Form 9465 and may have to submit financial information on Form 433-F.⁹ An installment agreement does not stop interest, but it does keep collection action at bay.

If You Want to Contest the Penalty

Trust Fund Recovery Penalty (CP15B)

Fighting a TFRP is unusual, and the procedure catches people off guard. You cannot simply write a letter disagreeing. To formally contest it you must:

Make a partial payment equal to the withheld tax attributable to one employee for each quarter the penalty covers. If the penalty is based on excise taxes instead of employment taxes, pay the amount tied to one transaction per quarter.
File a separate Form 843 (Claim for Refund and Request for Abatement) for each quarter at issue.

This partial-payment-and-refund-claim procedure is the only way to reach court on a TFRP dispute without paying the entire penalty first.² If the IRS denies your Form 843 claim, you can then sue in federal district court or the Court of Federal Claims.

To suspend collection while your case is pending, you also have to post a bond equal to one and a half times the balance remaining after your partial payment.² That bond requirement is why most people try to resolve these penalties before the CP15B stage.

Other Civil Penalties

For non-TFRP penalties, respond by the deadline on the notice with a written explanation of why the penalty should be removed. Mail your response to the specific address on the notice, not to a general IRS processing center. Include a copy of the notice, a clear statement of your position, and copies of documents that support it.

You can also request abatement by phone at the number on your notice, or by filing Form 843.¹⁰ The Form 843 instructions note that if your notice already includes instructions for contesting the penalty, follow those first; Form 843 may not be necessary.¹¹

Send everything by certified mail with return receipt. If the IRS later claims you missed a deadline, that receipt is your proof.

Penalty Relief You Can Request

First-Time Penalty Abatement

If you have a clean compliance record, the IRS may waive the penalty under its First Time Abate policy. You need to have filed the same type of return for each of the three tax years before the penalty year, and you must not have had penalties during those three years (or any prior penalty must have been removed for an acceptable reason). No documentation is required; the IRS checks your account.¹²

An important limit: First Time Abate does not apply to penalties with event-based filing requirements.¹² Many international information returns fall into that category, so this relief may not be available for the very penalties that drive the largest CP15 assessments. Request it by calling the number on your notice; if you ask for reasonable cause relief but qualify for First Time Abate, the IRS applies it automatically.

Reasonable Cause

If you exercised ordinary care and prudence but couldn’t comply because of circumstances beyond your control, the IRS may abate the penalty for reasonable cause. Examples include serious illness, natural disasters, destruction of records, and reliance on incorrect advice from a tax professional. You need to show you tried to meet the obligation and that something specific stopped you.

You can request reasonable cause relief by phone at the number on your notice. Have the notice, a clear explanation, and any supporting documents ready. If the IRS can’t approve relief on the call, follow up with Form 843 and a written statement with attachments.¹⁰

What Happens If You Ignore the Notice

The penalty doesn’t go away. Interest keeps accruing at 7% per year.⁸ If you still don’t respond, the IRS will move to collection: federal tax lien, bank levy, or wage garnishment. Before levying, the IRS must send a separate Notice of Intent to Levy, which gives you 30 days to request a Collection Due Process hearing.¹³

A CDP hearing lets you propose alternatives to enforced collection and, in limited circumstances, dispute the underlying penalty if you didn’t have a prior opportunity to do so.¹³ But by the time you’re there, months or years of interest have already piled on. Responding early keeps your options open and holds down the total.

When to Bring in a Professional

CP15 penalties usually aren’t the kind of notice you can resolve with a quick letter or a small check. Trust fund recovery penalties can run into six figures and carry personal liability that survives bankruptcy. International reporting penalties stack across years and forms. If either category applies to you, a tax attorney or enrolled agent who handles IRS penalty cases is worth the cost, particularly for TFRP disputes where the partial-payment and refund-claim procedure has strict requirements. Missing a step can forfeit your right to contest the penalty in court.

1
Internal Revenue Service. Internal Revenue Manual 21.3.1 – Taxpayer Contacts Resulting From Notice Issuance
2
Internal Revenue Service. Understanding Your CP15B Notice
3
Office of the Law Revision Counsel. 26 USC 6672 – Failure to Collect and Pay Over Tax, or Attempt to Evade or Defeat Tax
4
Internal Revenue Service. Internal Revenue Manual 8.25.1 – Trust Fund Recovery Penalty Overview and Authority
5
Internal Revenue Service. Internal Revenue Manual 20.1.9 – International Penalties
6
Internal Revenue Service. International Information Reporting Penalties
7
Internal Revenue Service. Internal Revenue Manual 20.1.7 – Information Return Penalties
8
Internal Revenue Service. Interest Rates Remain the Same for the First Quarter of 2026
9
Internal Revenue Service. Payment Plans – Installment Agreements
10
Internal Revenue Service. Penalty Relief for Reasonable Cause
11
Internal Revenue Service. Instructions for Form 843
12
Internal Revenue Service. Administrative Penalty Relief
13
Internal Revenue Service. Collection Due Process (CDP) FAQs