Collection Due Process Hearings: Your Right To Challenge IRS Liens and Levies

You just received a notice from the IRS. It says they've filed a federal tax lien against you—or they're about to levy your wages, bank accounts, or other property.

You have 30 days to do something about it.

That "something" is called a Collection Due Process hearing, or CDP hearing. It's a formal right created by Congress that gives you an independent review of IRS collection action—and it pauses collection while the hearing is pending.

This guide explains how CDP hearings work, what you can and cannot raise, the deadlines you must meet, and what happens if you disagree with the outcome.

What Is a CDP Hearing?

A CDP hearing is your right to an independent review before the IRS takes collection action against you. Congress created this right in 1998 through IRC § 6320 (for liens) and IRC § 6330 (for levies).

The core idea is simple: before the IRS can seize your property or lock up your assets with a lien, you get a chance to be heard by someone who wasn't involved in the original collection decision.

There are two triggers for CDP rights:

• Notice of Federal Tax Lien filing (Letter 3172). The IRS must notify you within 5 business days of filing the lien.
• Notice of Intent to Levy (Letter 1058 or LT11). The statute requires this notice before the IRS can levy:

"No levy may be made on any property or right to property of any person unless the Secretary has notified such person in writing of their right to a hearing under this section before such levy is made." — IRC § 6330(a)(1)

Your hearing is conducted by the IRS Independent Office of Appeals—a separate division from the collection office that issued the notice. The Appeals officer assigned to your case must be someone who has had no prior involvement with your unpaid tax.

The 30-Day Deadline

You have 30 days from the day after the date on your notice to request a CDP hearing. File Form 12153, Request for a Collection Due Process or Equivalent Hearing.

This deadline is strict. Unlike some IRS procedures where timing is flexible, the 30 days CDP window directly affects your legal rights.

If you file within 30 days:

• Collection is suspended while your hearing is pending
• You preserve your right to petition the Tax Court if you disagree with the outcome
• The statute of limitations on collection is paused

If you miss the 30 days deadline:

• You can request an "equivalent hearing" within one year of the notice
• But collection continues—the IRS does not have to stop
• You cannot petition the Tax Court if you disagree with the result

The difference is significant enough that it's worth a closer look.

CDP Hearing vs. Equivalent Hearing

An equivalent hearing gives you the same conversation with Appeals, but without the legal teeth. If you're reading this and you're still within 30 days, file Form 12153 now.

What You Can Raise at a CDP Hearing

The statute gives you broad latitude to raise issues at your hearing. Under IRC § 6330(c)(2)(A), you may raise "any relevant issue relating to the unpaid tax or the proposed levy," including:

Collection Alternatives

This is the most common reason people request CDP hearings. You can propose:

• Installment agreement—a monthly payment plan. If you owe $50,000 or less, streamlined options are available.
• Offer in compromise (OIC)—settling for less than you owe. The $205 application fee is waived for low-income taxpayers.
• Currently not collectible (CNC) status—if paying would prevent you from meeting basic living expenses, the IRS may temporarily stop collection.
• Posting a bond or substituting other assets—less common, but available.

The Appeals officer's determination must consider "whether any proposed collection action balances the need for the efficient collection of taxes with the legitimate concern of the person that any collection action be no more intrusive than necessary." — IRC § 6330(c)(3)

Appropriateness of Collection Action

You can argue that the specific collection action the IRS chose is inappropriate. For example, levying your only bank account when a lien would be sufficient, or levying when you've been making good-faith payments.

Spousal Defenses

If the tax debt arose from a joint return and your spouse or former spouse was responsible, you can raise innocent spouse relief under IRC § 6015.

The Underlying Liability

You can challenge whether you actually owe the tax—but only if you did not receive a Notice of Deficiency or otherwise have a prior opportunity to dispute the liability. This is a critical limitation.

What You Cannot Raise

Liability You Already Had a Chance To Dispute

If the IRS sent you a Notice of Deficiency and you either let the 90-day deadline pass or petitioned the Tax Court and lost, you cannot relitigate that issue in a CDP hearing. The statute specifically bars this. See You Missed the 90-Day Deadline. Now What? for your options in that situation.

Issues From a Prior CDP Hearing

If you already had a CDP hearing for the same tax period, you cannot raise the same issues again. You're entitled to only one CDP hearing per taxable period per type of notice.

Frivolous Arguments

The IRS and Tax Court will not entertain arguments that the income tax is unconstitutional, that wages are not income, or similar positions. Filing a frivolous CDP request can trigger a $5,000 penalty under IRC § 6702. If you take frivolous positions to the Tax Court, the court can impose an additional penalty of up to $25,000 under IRC § 6673.

What Happens During the Hearing

Despite the word "hearing," most CDP proceedings are not courtroom-style events. Here's what to expect:

Assignment to a Settlement Officer

Your case is assigned to a Settlement Officer (SO) in the IRS Independent Office of Appeals. This person reviews your file independently from the collection division.

Verification

The Settlement Officer must first verify that the IRS followed proper procedures—that the tax was properly assessed, that required notices were sent, and that applicable law was followed.

"The appeals officer shall at the hearing obtain verification from the Secretary that the requirements of any applicable law or administrative procedure have been met." — IRC § 6330(c)(1)

Format

Most CDP hearings are conducted by phone or through correspondence—not in person. You'll submit documents, the Settlement Officer reviews them, and you discuss options by phone. You can request a face-to-face conference, but the IRS is not required to grant one.

Financial Documentation

If you're proposing a collection alternative, you need to show the IRS your financial picture. Be prepared to complete:

• Form 433-A (Collection Information Statement for Wage Earners and Self-Employed Individuals)—or Form 433-B for businesses
• Supporting documents: bank statements, pay stubs, proof of expenses, asset valuations

The more thorough your financial documentation, the stronger your position. A vague request for "some kind of payment plan" with no supporting numbers is unlikely to succeed.

After the Hearing: Notice of Determination

After considering your case, the Settlement Officer issues a Notice of Determination. This is the Appeals office's final decision on the collection action.

If you disagree, you have 30 days from the date of the Notice of Determination to petition the Tax Court for review:

"The person may, within 30 days of a determination under this section, petition the Tax Court for review of such determination (and the Tax Court shall have jurisdiction with respect to such matter)." — IRC § 6330(d)(1)

Standard of Review

How the Tax Court reviews your case depends on what you raised:

• Collection issues (appropriateness of action, collection alternatives): The court reviews for abuse of discretion. This means the Appeals officer's decision stands unless it was arbitrary, capricious, or without sound basis in fact or law.
• Underlying liability (if you were entitled to raise it): The court reviews de novo—meaning it looks at the issue fresh, without deferring to the IRS.

The abuse of discretion standard is harder to overcome. This is why the hearing itself matters—you want the best possible outcome at the Appeals level.

Suspension of Collection

One of the most important features of a timely CDP request is that it pauses IRS collection:

"If a hearing is requested under subsection (a)(3)(B), the levy actions which are the subject of the requested hearing and the running of any period of limitations under section 6502... shall be suspended for the period during which such hearing, and appeals therein, are pending." — IRC § 6330(e)(1)

This suspension continues through the hearing, any Tax Court petition, and any subsequent appeals. It gives you breathing room to negotiate without the threat of seizure hanging over you.

One trade-off: the 10 years collection statute of limitations is also paused during this period. So while you gain time to negotiate, the IRS gains time to collect if negotiations fail.

Common Mistakes To Avoid

Missing the 30 days deadline. This is the most consequential mistake. Mark the date. File Form 12153 early if possible. An equivalent hearing is better than nothing, but it lacks the collection suspension and Tax Court rights that make CDP hearings powerful.

Filing a vague Form 12153. The form asks you to state the reasons for your hearing request. "I disagree" is not enough. Be specific: identify which collection alternatives you want to discuss, what issues you want to raise, and why the proposed action is inappropriate.

Showing up without financial documentation. If you're asking for an installment agreement or OIC, the Settlement Officer needs to see your numbers. Requesting a collection alternative without Forms 433-A/433-B and supporting documents will stall or sink your case.

Challenging liability when you already had the chance. If you received a Notice of Deficiency and didn't petition the Tax Court within 90 days, the CDP hearing is not a second bite at that apple. Focus on collection alternatives instead.

Not requesting alternatives explicitly. The Settlement Officer considers what you raise. If you don't ask for an installment agreement, OIC, or CNC status, the officer is not required to volunteer these options. Be proactive about what you want.

A Note on Jurisdiction: Timing Matters

The Tax Court's jurisdiction over CDP cases depends on an active collection action. In Commissioner v. Zuch, 605 U.S. ___ (2025), the Supreme Court held 8-1 that the Tax Court lacks jurisdiction under § 6330 when the IRS is no longer pursuing a levy—for example, because the underlying liability has been satisfied. If the basis for the levy disappears before your case is resolved, the Tax Court may dismiss it.

The takeaway: if you receive an unfavorable Notice of Determination and plan to petition the Tax Court, do so promptly within the 30-day window. Don't assume the underlying collection action will remain in place indefinitely.

Key Statutes at a Glance

Resources

• Form 12153—Request for a Collection Due Process or Equivalent Hearing
• Publication 1660—Collection Appeal Rights
• IRS Collection Due Process FAQ
• Taxpayer Advocate: Levies
• How IRC § 6213 Protects You While Your Tax Court Case Is Pending

This article is for informational purposes only and does not constitute legal or tax advice. For advice specific to your situation, consult a qualified tax professional or attorney.