IRS Letter CP89
Why are you receiving this letter?
You received IRS letter CP89 because you have entered into an installment agreement with the IRS to pay off a tax balance. The purpose of the letter is to detail the payments made to date.
The IRS will include a page titled Installment Agreement Activity. This page does confuse some taxpayers. The main source of confusion is the penalty added and interest added column. These columns don’t show the amount of penalties and interests added for the year. The amounts reported actually show the total amount of penalties and interest added since the tax return was filed. This is a standing balance that will increase slightly every year.
- No further action is required if you have an arrangement with the IRS.
- There are no missing payments.
- You don’t agree with the penalties or interest charged
- You would like to discuss this with someone not working for the IRS to understand what is going on and the options you have.
What you should do?
Read IRS letter CP89 carefully. It provides a history of the payments made to the IRS for the past year. If you made payments and do not see them, contact the IRS to provide proof of payment.