A tax notice arriving in the mail is one of the most stressful moments in business ownership. The envelope looks official. The language is formal. The deadline is often short. And the amount due — if there is one — can be large enough to disrupt your cash flow.
But most tax notices are not emergencies. They are requests for information, corrections of errors, or reminders of balances due. The businesses that handle them well are the ones that respond quickly, accurately, and with the right professional support.
This guide explains how to respond to an IRS notice and a Louisiana Department of Revenue notice, step by step.
First: identify who sent the notice
Before you do anything else, determine whether the notice came from the IRS or the Louisiana Department of Revenue (LDR). The two agencies operate separately, have different procedures, and require different responses.
| Agency | What it handles | How to respond |
|---|---|---|
| IRS | Federal income tax, payroll tax, estate tax, excise tax | Respond by mail, online (IRS account), or through a CPA |
| LDR | Louisiana income tax, sales tax, withholding tax, corporate tax | Respond through LaTAP, by mail, or through a CPA |
If the notice came from a parish taxing authority — not the state — the procedure may differ. Sales tax notices, for example, may come from the parish where the tax was collected or from the Louisiana Sales and Use Tax Commission for Remote Sellers.
How to respond to an IRS notice
The IRS sends notices for many reasons: a balance due, a changed refund, a question about your return, a need to verify your identity, a correction to your return, or a delay in processing.
Step 1: Read the notice carefully
Find the notice number in the top right corner. It will start with “CP” or “LTR” — for example, CP2000 or LTR 11C. Search for that number on IRS.gov to get specific instructions about what the notice means and what you need to do.
The notice will tell you:
- Why the IRS contacted you
- The tax period involved
- Any amount due
- The deadline to respond
- What action, if any, you need to take
Step 2: Compare the notice to your return
If the notice says the IRS changed or corrected your return, compare the information in the notice to your filed return. If you agree, note the corrections on your copy and keep it for your records. If you disagree, follow the dispute instructions in the notice.
Step 3: Take action by the deadline
What you do next depends on the situation:
If you agree with the notice: Take the requested action. You do not need to reply unless the IRS specifically asks you to.
If you disagree: Follow the instructions to dispute what the notice says. Include information and copies of documents for the IRS to review. To guarantee your appeal rights, reply by the due date.
If you have an amount due: Pay by the due date, even if you cannot pay the full amount. This reduces interest and penalty charges. If you cannot pay in full, you can request an installment agreement.
Step 4: Watch for scams
If the letter does not appear when you search for it on IRS.gov, or if it looks suspicious, call the IRS at 800-829-1040. Do not call the number on a suspicious letter. The IRS does not initiate contact by email, text, or social media to request personal or financial information.
How to respond to a Louisiana Department of Revenue notice
LDR sends notices for similar reasons: to request information, verify your account, request a payment, or ask for documentation. Most notices can be resolved quickly and securely online through LaTAP.
Step 1: Read the notice
Your notice explains:
- Why LDR contacted you
- The tax type and tax period involved
- Any amount due
- Any action you need to take
- Response deadlines
- Available resolution options
Write down the notice number, tax type, tax period, amount due, and deadline before you do anything else.
Step 2: Review your account in LaTAP
Log into LaTAP at latap.revenue.louisiana.gov. From your account, you can:
- View your balance
- Review payments
- View notices
- Make a payment
- Request a payment plan
- Send secure messages
- Upload requested documents
Many questions can be answered without calling LDR. If the notice says you owe a balance, LaTAP will show you the breakdown. If the notice requests documentation, you can upload it directly through the portal.
Step 3: Contact your tax professional
If the return referenced in your notice was prepared by a CPA, attorney, enrolled agent, or other tax professional, contact them first. They can explain why you received the notice, review your return, correct errors, and respond to LDR on your behalf.
A valid Power of Attorney or other authorization may be required before LDR can discuss confidential tax information with your representative. If you do not have one on file, your CPA can prepare it.
Common notices and what they mean
IRS notices
| Notice | What it means | What to do |
|---|---|---|
| CP2000 | Underreporter notice — IRS believes you underreported income | Review the proposed changes. Agree and pay, or disagree with documentation. |
| CP501 | Balance due reminder | Pay the balance or request an installment agreement. |
| CP504 | Intent to levy | This is serious. Respond immediately or request a Collection Due Process hearing. |
| CP01A | New IP PIN assigned | Keep the PIN for filing your next return. |
| LTR 11C | Identity verification | Follow the instructions to verify your identity. |
LDR notices
| Notice | What it means | What to do |
|---|---|---|
| Sales tax notice | Discrepancy in reported sales tax | Review your returns, respond through LaTAP or by mail. |
| Withholding tax notice | Payroll withholding discrepancy | Verify your payroll records, respond with documentation. |
| Corporate income tax notice | Discrepancy in corporate return | Review the notice, respond with supporting documents. |
| Request for information | LDR needs documentation | Upload documents through LaTAP. |
What happens if you ignore a tax notice
Ignoring a tax notice does not make it go away. It makes it worse.
| Consequence | What happens |
|---|---|
| Additional penalties | Late filing and late payment penalties accrue from the original due date. |
| Interest | Interest accrues daily on unpaid balances. |
| Liens | The IRS or LDR can file a tax lien against your business assets. |
| Levies | The IRS or LDR can levy your bank accounts, receivables, or wages. |
| Administrative dissolution | LDR can revoke your business licenses or dissolve your entity. |
| Loss of appeal rights | If you miss the deadline to dispute, you lose the right to appeal. |
When to hire a CPA
You can handle simple notices yourself. A math error notice, a request for a missing form, or a balance due reminder are usually straightforward.
You should hire a CPA if:
- The notice involves an audit or examination
- The amount due is significant
- You disagree with the notice and need to dispute it
- The notice involves payroll tax, sales tax, or multi-state issues
- You have received multiple notices
- You have received a final notice of intent to levy or lien
- You do not understand what the notice is asking
CPAs have unlimited representation rights before the IRS. They can correspond with the IRS on your behalf, request extensions, and resolve the issue without you having to speak to the agency directly. A CPA can also help you respond to LDR notices and represent you in Louisiana tax disputes.
The bottom line
A tax notice is not a crisis. It is a request for action. The businesses that handle notices well are the ones that read the notice carefully, respond by the deadline, and bring in professional help when the issue is complex.
If you receive an IRS or LDR notice:
- Read it carefully
- Identify the notice number and deadline
- Review your account online (IRS or LaTAP)
- Respond by the deadline — agree, dispute, or pay
- Contact your CPA if the issue is complex
Do not ignore a tax notice. The cost of ignoring it is always higher than the cost of responding.
Frequently asked questions
What should I do first when I receive an IRS notice?
Read the notice carefully and identify the notice number (CP or LTR) in the top right corner. Review the tax period, the amount due (if any), and the response deadline. Then compare the notice to your tax return. If you agree with the notice, take the requested action. If you disagree, follow the dispute instructions before the deadline to preserve your appeal rights.
What should I do first when I receive a Louisiana Department of Revenue notice?
Read the notice and identify the notice number, tax type, tax period, amount due, and response deadline. Then log into LaTAP to review your account, view the notice, and check your balance. Many LDR notices can be resolved entirely online without calling. If the return was prepared by a CPA, contact them first before responding to LDR.
Can I ignore a tax notice if I think it is wrong?
No. Ignoring a tax notice — even one you believe is incorrect — can result in additional penalties, interest, and in some cases, enforced collection actions like liens or levies. You must respond by the deadline, either by agreeing and paying, or by disputing with supporting documentation. If you do nothing, the IRS or LDR will proceed with its proposed action.
How long do I have to respond to an IRS notice?
The response deadline is stated on the notice itself. Common deadlines range from 10 to 30 days for simple requests to 90 days for formal appeals. For collection notices, you generally have 30 days to request a Collection Due Process hearing. Never assume you have more time than the notice states — the deadline is legally binding.
Should I hire a CPA to respond to a tax notice?
If the notice involves a complex issue, a large balance, an audit, or a dispute you do not understand, hiring a CPA is almost always worth the cost. CPAs have unlimited representation rights before the IRS and can respond on your behalf, request extensions, and resolve the issue without you having to speak to the agency directly. For simple notices — like a math error or a missing payment — you may be able to resolve it yourself.
Sources
Find a CPA in Louisiana
Need help with Louisiana tax, bookkeeping or business advisory? Tell us what you need and we will introduce you to a licensed Louisiana CPA, free of charge.
Get Matched with a CPA →Louisiana CPA Hub is an independent referral service. It is not an accounting firm and does not provide tax, accounting, legal or financial advice.