Understanding IRS Notice CP49: What It Means and How an Enrolled Agent Can Help
Steve PerryIRS Notice CP49 informs taxpayers that their current-year tax refund has been applied to a prior federal tax debt instead of being issued as a check or deposit. While this can be unexpected, especially if the previous debt was unknown or forgotten, it’s not a penalty—just the IRS exercising its right to apply overpayments toward outstanding balances. The notice outlines the original refund amount, the tax year to which the funds were applied, and any remaining balance or refund due. This process is part of the Treasury Offset Program, which allows the IRS to apply refunds to unpaid federal taxes and, in some cases, other government debts like child support or student loans. Upon receiving CP49, taxpayers should verify the debt’s accuracy, dispute any errors, or explore options like payment plans or hardship status if a balance remains. In some cases, the refund is applied even if the taxpayer is making regular payments. **Steve Perry, Enrolled Agent** at Books, Taxes & More, can help taxpayers understand their CP49 notice, access IRS records, dispute inaccurate offsets, and resolve underlying tax issues. With expert guidance, taxpayers can avoid confusion, resolve debts properly, and take steps to prevent future refund reductions. Don’t navigate this alone—get professional help.