Collection Due Process (CDP) refers to a legal procedure that allows taxpayers to appeal certain IRS collection actions. Under the Internal Revenue Code, when the IRS issues a notice of intent to levy or a notice of lien, taxpayers have the right to request a hearing before the IRS Office of Appeals.
The CDP process provides taxpayers with an opportunity to challenge the proposed collection action, ensuring their rights are protected. During the hearing, taxpayers can present their case, potentially negotiate payment plans, or argue for alternative solutions to resolve their tax liabilities. This process is essential for maintaining fairness in the tax collection system and ensuring that taxpayers are given a chance to have their situations considered before aggressive collection methods are employed.
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