Early in the collection sequence
IRS Notice CP49: What It Means and What to Do
Your refund was used to pay a tax debt.
What this notice is
CP49 tells you that the IRS used all or part of your refund to pay a tax debt.
The deadline
No deadline is printed on this notice — it reports something that has already happened.
What happens if nothing is done
Any remaining credit is refunded to you if no other tax is owed.
Your options
- Check the notice against your own record of what was owed.
- Contact the IRS if you believe the debt was already settled.
- If you paid your full balance in the past 21 days and your account shows a credit, the IRS states it will refund it provided no other tax is owed.
The part people get wrong
This notice is often the first a person learns that an old balance existed at all — the refund simply did not arrive. Treat it as evidence of an open account, not as a closing statement.
Where this notice sits
This notice sits outside the payment sequence below — it is not a demand for money that has been assessed against you in the ordinary way.
- 1CP14The first bill. The IRS says you owe money on unpaid taxes.
- 2CP501A reminder that you still have an unpaid balance on one of your tax accounts.
- 3CP503The second reminder. The IRS has still not heard from you.
- 4CP504Notice of Intent to Levy. The tone of the sequence changes here.
- 5CP523Your installment agreement is about to be terminated.
- 6LT11 / Letter 1058The final notice before seizure — and the one with a 30-day clock on your appeal right.
- 7CP90Final notice of intent to levy, with notice of your right to a hearing.
- 8CP508CYour tax debt has been certified as seriously delinquent — and the State Department has been told.
Two notices sit outside this sequence: CP2000 proposes a change and is not a bill, and CP49 reports that a refund was already applied to a debt.
Every statement on this page comes from the IRS's own page for this notice, read on 2026-09-01. Where the IRS does not state something — a fixed number of days, for instance — this page does not state it either.
If you owe the money
Interest runs at 7% a year, compounded daily, and the failure-to-pay penalty adds 0.5% of the unpaid tax for each month or part of a month. An approved payment plan halves that penalty to 0.25%. On a $10,000 balance carried for a year the difference is $300 — for a step that costs nothing today.
IRS Fresh Start
Payment plans and what they change
Penalty Abatement
When the IRS removes penalties
Tax Debt Forgiveness
What is real and what is marketing
Currently Not Collectible
When you genuinely cannot pay
When Collection Rights Expire
The ten-year clock
Wage Garnishment Calculator
What a levy leaves you
Other IRS notices
CP14
The first bill. The IRS says you owe money on unpaid taxes.
CP501
A reminder that you still have an unpaid balance on one of your tax accounts.
CP503
The second reminder. The IRS has still not heard from you.
CP504
Notice of Intent to Levy. The tone of the sequence changes here.
LT11 / Letter 1058
The final notice before seizure — and the one with a 30-day clock on your appeal right.
CP90
Final notice of intent to levy, with notice of your right to a hearing.
CP523
Your installment agreement is about to be terminated.
CP508C
Your tax debt has been certified as seriously delinquent — and the State Department has been told.
CP2000
Not a bill. The income reported to the IRS does not match your return.
This page is for general information only and is not tax or legal advice. Settlement Insight is not a law firm, is not a tax representative and does not represent any party. Consult a licensed tax professional or attorney about your specific notice.