If the IRS has issued a notice of federal tax lien or a notice of intent to levy, you have the right to fight back. However, the IRS offers two distinct paths for collection appeals: the Collection Due Process (CDP) and the Collection Appeals Program (CAP).
Choosing the wrong one could cost you your right to go to Tax Court. Here is a breakdown of how they differ and which one fits your situation.
1. Collection Due Process (CDP): The "Gold Standard"
A CDP hearing is generally the most powerful tool a taxpayer has. It was created by Congress to ensure taxpayers have a formal opportunity to challenge a lien or levy before their property is taken.
- When to use it: When you receive a "Notice of Intent to Levy" or a "Notice of Federal Tax Lien Filing."
- The Deadline: You have 30 days from the date on the notice to file Form 12153
.
- The Big Advantage: If you lose your CDP hearing, you have the legal right to appeal the decision to the U.S. Tax Court.
- The Automatic Stay: While a timely CDP request is pending, the IRS is legally prohibited from seizing your assets (levying) for that specific tax period.
2. Collection Appeals Program (CAP): The "Fast Track"
The CAP is designed to be much quicker and more flexible than a CDP hearing, but it comes with a significant trade-off.
- When to use it: Use CAP to dispute a broader range of actions, such as the rejection, modification, or termination of an Installment Agreement.
- The Process: You usually start by discussing the issue with an IRS Collection Manager. If you still disagree, you file Form 9423
.
- The Speed: CAP decisions are usually made within 5 to 15 business days.
- The Catch: The decision made by the Appeals Officer in a CAP case is final. You cannot appeal a CAP decision to the U.S. Tax Court.
Comparison at a Glance
| Feature |
CDP (Collection Due Process) |
CAP (Collection Appeals Program) |
| Form Used |
Form 12153 |
Form 9423 |
| Deadline |
Strictly 30 Days |
Varies (often very short) |
| Can go to Tax Court? |
Yes |
No |
| Stops Levy Action? |
Yes |
Usually, but not guaranteed |
| Best For |
Liens and Levies |
Installment Agreements |
Which Should You Choose?
The choice often comes down to your ultimate goal.
- Choose CDP if you want the maximum legal protection possible and want to keep the door open to a judge reviewing your case in Tax Court.
- Choose CAP if you need a decision immediately (for example, to prevent a seizure happening tomorrow) and you are confident that the Appeals Officer will see things your way without needing a court's intervention.
Don't Navigate This Alone
The difference between these two programs is technical, and the paperwork is unforgiving. If you miss the 30-day CDP deadline, you may be forced into an "Equivalent Hearing," which robs you of your right to go to Tax Court.
