CP259F Notice: Why the IRS Thinks You Haven’t Filed

Last updated 10/30/2024 by

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Summary:

The CP259F Notice is issued by the IRS when a taxpayer fails to file the required Form 5227, the Split-Interest Trust Information Return. This notice informs the taxpayer of the missing form and provides instructions on how to respond, whether the form has already been filed or still needs to be completed. It is crucial to respond promptly to avoid penalties or further IRS actions. The notice explains the steps to file the form and provides guidance if you believe you’re not required to file.

Receiving a notice from the IRS can be stressful, especially when it involves a missing tax form. The CP259F Notice is one such letter that notifies taxpayers they have not filed the required Form 5227, Split-Interest Trust Information Return. This form is essential for certain trusts that hold charitable assets, and failure to file it could result in penalties and complications with the IRS. Whether you’ve already filed and the IRS has not yet processed it, or you need to file the form, it’s important to act promptly. In this article, we’ll guide you through what to do if you receive a CP259F Notice and how to resolve the issue effectively.

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What is the CP259F notice?

The IRS sends the CP259F Notice to inform taxpayers that they have failed to file Form 5227, Split-Interest Trust Information Return, which is required for certain trusts. The form provides detailed financial information about the trust’s operations and charitable distributions. The IRS uses this data to verify the trust’s tax obligations.

Form 5227 is specifically required for trusts that are part of charitable giving arrangements, such as charitable remainder trusts or pooled income funds. If you are the trustee of such a trust, failing to file this form could lead to penalties and potential audits.

The CP259F Notice typically arrives when the IRS detects that a required form was not filed by its due date. The notice explains the missing filing and provides instructions on how to rectify the situation. It’s essential not to ignore this notice, as failing to file or provide an explanation can lead to further IRS enforcement actions.

Pro tip

Always keep copies of all submitted tax forms and related correspondence with the IRS. This ensures you have documentation on hand if questions arise regarding your filings.

How the CP259F notice affects you

Receiving a CP259F Notice means the IRS believes you did not file a required Form 5227, and this can have significant consequences. If you do not respond to the notice or fail to file the form, the IRS may impose penalties, interest, or even begin enforcement actions such as audits or tax liens.

The IRS expects a prompt response. If you have already filed Form 5227 but have received the notice anyway, it may be because of delays in processing, or an error in the filing details (like using a different Employer Identification Number (EIN) or name). In this case, you must still respond to the notice, confirming the filing and providing any necessary corrections.

If you have not yet filed Form 5227, it is important to do so immediately. Failing to file can lead to mounting penalties, which increase the longer the return remains unfiled. Even if you do not believe your trust is required to file, you must respond to the notice and provide an explanation.

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What should you do when you receive a CP259F notice?

When you receive a CP259F Notice, it’s essential to act quickly to avoid potential penalties and delays. Here are the steps you should take:

Carefully read the notice to ensure you understand why it was sent and what is required from you.
If you already filed Form 5227 within the last four weeks, you can disregard the notice, assuming you used the correct EIN and name. Otherwise, you must respond.
If you filed more than four weeks ago or used a different EIN or name, complete the Response Form included with the notice, and mail it along with a signed and dated copy of Form 5227 to the IRS.
If you haven’t filed yet, use an authorized e-file provider or follow instructions in the notice to submit the paper version of Form 5227 as soon as possible.
If you believe you are not required to file Form 5227, complete the Response Form included with the notice and explain why the form is not necessary for your trust.

Pro tip

Consider consulting a tax professional who specializes in trusts to navigate complex filing requirements and ensure compliance with IRS regulations.

How to respond to the CP259F notice

Steps to take when responding to a CP259F notice

To resolve the CP259F Notice, you need to follow the IRS instructions carefully. Here are the general steps:

1. Verify your filing requirements: Ensure that your trust is required to file Form 5227 by reviewing the filing guidelines provided by the IRS for split-interest trusts. If you’re unsure, consult with a tax professional.
2. Complete the Response Form: If the form was already filed but not processed, or if there was an error, fill out the Response Form that comes with the notice. You should also send a signed and dated copy of Form 5227 if it was not already filed.
3. Submit the required documentation: If you have yet to file, prepare Form 5227 and submit it to the IRS. Include any additional schedules or documentation that might be required, depending on the type of trust.
4. Mail or fax your response: The notice typically includes instructions on where to mail or fax your completed response. If you’re filing electronically, follow the specific e-file instructions provided by your tax professional or e-file service.

Responding promptly and accurately ensures the IRS processes your return without delays and prevents penalties from accumulating.

Alternative methods for handling a CP259F notice

If you are not comfortable responding to the CP259F Notice on your own, there are several alternatives available:

Consult a tax professional: A certified public accountant (CPA) or tax attorney can help you understand your obligations and assist with completing and filing the necessary forms.
Visit a local IRS office: If you need further clarification or have complex questions, visiting a local IRS office may help you get more personalized assistance.
Use the IRS online tools: The IRS offers several online tools and resources to help you determine your filing requirements and respond to notices. For example, the Interactive Tax Assistant can guide you through various tax-related issues, including filing obligations.

Pro tip

Utilize IRS online tools, like the Interactive Tax Assistant, to clarify your filing obligations and stay informed about updates related to your tax situation.

What happens if you don’t respond to the CP259F notice?

Ignoring the CP259F Notice can have severe consequences. If you do not file Form 5227 or provide an explanation for why it wasn’t filed, the IRS may take enforcement actions, including:

Penalties and interest: Failing to file could lead to financial penalties that accumulate over time. Interest may also be charged on unpaid penalties.
Potential audits: The IRS may decide to audit your trust or related tax filings if they believe there is a pattern of non-compliance.
Enforcement actions: In extreme cases, the IRS may take action such as placing a tax lien on the trust’s assets or pursuing other forms of collection.

It’s critical to respond to the notice as soon as possible to avoid these outcomes. Filing your return or providing the necessary response prevents further complications.

Tips for avoiding future issues with Form 5227

To avoid receiving another CP259F Notice in the future, here are some helpful tips:

Track your deadlines: Be aware of the filing deadlines for Form 5227. Typically, this form is due by April 15 each year, but extensions may be available if requested in advance.
Keep accurate records: Ensure that all trust-related financial records are accurate, complete, and filed on time. This includes maintaining detailed information on charitable contributions and trust distributions.
Consider electronic filing: Filing Form 5227 electronically can help avoid processing delays and minimize errors. Electronic submissions are typically processed faster by the IRS.
Work with a professional: A tax professional familiar with trust administration can help ensure that all necessary forms and schedules are submitted accurately and on time, preventing potential IRS issues.

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Frequently asked questions

What should I do if I disagree with the CP259F notice?

If you disagree with the CP259F Notice, you should respond promptly. Include a detailed explanation of why you believe the notice is incorrect, along with any supporting documentation. This could include proof that Form 5227 was filed or information demonstrating that your trust is not required to file. The IRS will review your case and respond accordingly.

How can I check the status of my Form 5227 submission?

To check the status of your Form 5227 submission, you can contact the IRS directly by calling their helpline or visiting your local IRS office. Keep your documentation handy, including any confirmation numbers or correspondence related to your filing, as this will help the IRS assist you more efficiently.

Are there any exceptions to filing Form 5227?

Yes, certain trusts may be exempt from filing Form 5227. Generally, if the trust does not have any charitable beneficiaries or does not engage in split-interest arrangements, it may not be required to file. Review the IRS guidelines or consult with a tax professional to determine your specific circumstances.

What happens if my trust qualifies for a filing extension?

If your trust qualifies for a filing extension, you must submit a request for the extension to the IRS before the original due date of Form 5227. Extensions typically allow additional time for filing without penalties, but it’s important to ensure that you meet the extended deadline and file the form as required.

Where can I find resources for understanding my tax obligations related to trusts?

You can find resources related to tax obligations for trusts on the IRS website. The IRS provides guidelines and information on various forms, including Form 5227. Additionally, consulting a tax professional who specializes in trust and estate planning can provide personalized advice tailored to your situation.

Need help understanding other IRS letters and notices? Visit our comprehensive guide to IRS Letters and Notices or search for the document you received in the table below.

IRS Letter or Notice Number

Notice Description

CP01	The IRS verified your claim of identity theft and will monitor your account.
CP01H	The IRS received a tax return with a social security number that belongs to a dead person.
CP02H	Money is due on an amended return based on a grant received due to Hurricane Katrina, Rita, or Wilma.
CP03C	You received the First-Time Homebuyer Credit for a house you purchased.
CP04	You may be eligible for tax deferment because either you or a spouse served in a combat zone, a qualified contingency operation, or a hazardous duty station during the tax year specified on your notice.
CP08	You may be entitled to additional money due to the Additional Child Tax Credit.
CP10	Your tax return changed due to a miscalculation, and the refund you wanted to apply to an estimated tax payment has changed.
CP10A	Your tax return changed due to a miscalculation of the Earned Income Credit, and the refund you wanted to apply to an estimated tax payment has changed.
CP11	You owe money because the IRS amended your return due to a miscalculation.
CP11A	Your tax return changed due to a miscalculation of the Earned Income Credit, and the refund you wanted to apply to an estimated tax payment also changed.
CP11M	Your tax return changed due to a miscalculation of the Making Work Pay and Government Retiree Credit, and the refund you wanted to apply to an estimated tax payment has changed.
CP12	You are due a bigger refund because the IRS corrected one or more mistakes on your tax return.
CP12A	The IRS made changes to correct the Earned Income Credit (EIC) claimed on your tax return.
CP12E or CP12F	The IRS corrected a miscalculation on your return.
CP12M	The IRS made changes to the computation of the Making Work Pay and/or Government Retiree Credits on your return.
CP12R	The IRS made changes to the computation of the Rebate Recovery Credit on your return.
CP13	The IRS made changes to your return due to a miscalculation. There is no refund or amount due. Your balance is zero.
CP13A	The IRS made changes to your return due to a miscalculation of the Earned Income Credit. There is no refund or amount due. Your balance is zero.
CP13M	The IRS made changes to your return due to a miscalculation of the Making Work Pay credit or the Government Retiree Credit. There is no refund or amount due. Your balance is zero.
CP13R	The IRS made changes to your return due to a miscalculation of the Recovery Rebate Credit. There is no refund or amount due. Your balance is zero.
CP14	You owe money on unpaid taxes.
CP16	The IRS made changes to your return due to a miscalculation. The refund you were due was applied to other tax debts.
CP21A	You owe money due to the changes you requested that the IRS make on your tax returns.
CP21B	You are due a refund due to the changes you requested that the IRS make on your tax returns. The money should arrive within 2 to 3 weeks.
CP21C	The IRS made the requested changes to your tax return. You will not receive a refund, and there is no tax due. Your balance is zero.
CP21E	As a result of your recent audit, the IRS made changes to your tax return, and you owe money as a result of those changes.
CP21I	The IRS made changes to your tax return relating to the Individual Retirement Arrangement (IRA) taxes. You owe money due to the changes.
CP22A	The IRS made the changes you requested, and you owe money as a result.
CP22E	As a result of your recent audit, the IRS changed your tax return, and you now owe money.
CP22I	The IRS made changes to your tax return relating to the Individual Retirement Arrangement (IRA) taxes. You owe money due to the changes.
CP23	The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. You owe taxes due to these changes.
CP24	The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. This resulted in an overpayment of estimated taxes.
CP24E	The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. This resulted in an overpayment of estimated taxes.
CP25	The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. You are not due a refund, nor do you owe any money. Your balance is zero.
CP31	You need to update your address because your refund check was returned to the IRS.
CP45	The IRS was unable to apply your overpayment to your estimated tax as you requested.
CP49	The IRS used all or part of your refund to pay a tax debt.
CP53	Your refund check will be sent by mail because the IRS can’t provide your refund through direct deposit.
CP57	The bank declined your payment, so the IRS was unable to draft funds from your bank account.
CP71	A reminder of the amount you owe in tax, penalty, and interest.
CP71A	A reminder of the amount you owe in tax, penalty, and interest.
CP71C	A reminder of the amount you owe in tax, penalty, and interest.
CP71D	A reminder of the amount you owe in tax, penalty, and interest.
CP88	The IRS is holding your refund because you haven't filed one or more tax returns, and it believes you will owe tax.
CP90	The IRS is notifying you of its intent to levy certain assets for unpaid taxes. You have the right to dispute the levy in a Collection Due Process hearing.
CP91	The IRS will levy up to 15% of your social security benefits for unpaid taxes.
CP120	The IRS needs documentation of your tax-exempt status.
CP120A	Your organization’s tax-exempt status has been revoked because it failed to file a Form 990 series return for three consecutive years.
CP130	You may no longer need to pay the Alternative Minimum Tax (AMT) because your tax return filing requirements changed.
CP152	The IRS received your return.
CP153	The IRS will send your refund by mail because your direct deposit did not go through.
CP161	You have an unpaid balance due to the IRS.
CP166	Your monthly payment to the IRS did not go through due to insufficient funds in your bank account.
CP178	You may no longer owe excise tax because your tax return filing requirements changed.
CP231	You need to update your address because your refund was returned to the IRS.
CP259	You did not file the business tax return identified in the notice.
CP259A	You should have filed these forms but did not – Form 990/990-EZ, Return of Organization Exempt From Income Tax, or Form 990-N (e-Postcard).
CP259B	The IRS requires you to file these forms but did not – Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation.
CP259C	The IRS believes that you are a private foundation, but did not file the required Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation.
CP259D	You must file this form, but you did not – Form 990-T, Exempt Organization Business Income Tax Return.
CP259E	You should have filed this form, but you did not – Form 990-N (e-Postcard) or Form 990/990-EZ, Return of Organization Exempt From Income Tax.
CP259F	The IRS requires you to file this form but did not – Form 5227, Split-Interest Trust Information Return.
CP259G	The IRS requires you to file this form, but you didn’t – Form 1120-POL, U.S. Income Tax Return for Certain Political Organizations.
CP259H	As a tax-exempt political organization, you must file this form, but you did not – Form 990/990-EZ, Return of Organization Exempt From Income Tax.
CP276A	You submitted your tax liability schedule incorrectly. The IRS typically charges a Federal Tax Deposit (FTD) penalty for this but did not this time.
CP276B	The IRS did not receive the correct amount of tax deposits. It normally charges a Federal Tax Deposit (FTD) penalty but did not this time.
CP297	The IRS is notifying you of its intent to levy certain assets for unpaid taxes. You have the right to dispute the levy at a Collection Due Process hearing.
CP297A	The IRS has levied your assets for unpaid taxes. You have the right to dispute the levy at a Collection Due Process hearing.
CP298	The IRS notifying you of its intent to levy up to 15% of your social security benefits for unpaid taxes.
CP501	You have a balance due on one of your tax accounts.
CP503	You have an unpaid balance on one of your accounts, and the IRS has not heard from you.
CP504	You have an unpaid amount due on your account. If you do not pay immediately, the IRS will levy your state income tax refund to apply it to the amount you owe.
CP504B	You have an unpaid amount due on your account. If you do not pay immediately, the IRS will levy certain property or rights to property to apply it to the amount you owe.
CP521	A reminder that you have an installment agreement payment due.
CP523	You have defaulted on your payment agreement. Therefore the IRS is terminating the agreement and will levy your assets.
CP601	Usted tiene un saldo pendiente de pago (dinero que le debe al IRS) en una de sus cuentas contributivas.
CP603	No hemos recibido respuesta de parte de usted y todavía tiene un saldo sin pagar en una de sus cuentas contributivas.
CP604	Usted tiene un saldo sin pagar en su cuenta. De no pagar esta cantidad inmediatemente, el IRS embargará cualquier reembolso de impuestos estatales al que tenga derecho y aplicarlo al pago de su deuda.
CP604B	Usted tiene un saldo sin pagar en su cuenta. De no pagar esta cantidad inmediatemente, el IRS embargará ciertas propiedades o derechos de propiedad y lo aplicará al pago de su deuda.
CP621	Este aviso es para notificarle que usted tiene un plan de pagos a plazos vencido. Por favor, envíe el pago inmediatamente.
CP623	Este aviso es para informarle nuestra intención de cancelar su plan de pagos a plazos y confiscar (embargar) sus bienes. Usted incumplió en su acuerdo.
CP711	Nosotros realizamos cambios a su planilla debido a que entendemos que hubo un cálculo erróneo. Como resultado de estos cambios, usted adeuda dinero por sus contribuciones.
CP721	Hicimos el(los) cambio(s) que usted solicitó a su declaración de impuestos para el año tributario que aparece en su aviso. Como resultado de éste(estos) cambio(s) usted debe dinero en sus impuestos.
CP722	Hicimos el(los) cambio(s) que usted solicitó a su declaración de impuestos para el año tributario que aparece en su aviso. Como resultado de éste(estos) cambio(s) usted debe dinero en sus impuestos.
CP771	Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses.
CP772	Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses.
CP773	Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses.
CP774	Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses.
CP959	Usted no radicó su planilla de contribución de negocios identificada en este aviso.
CP2000	The income or payment information on file doesn’t match your tax return. The discrepancy may result in an increase or decrease in your tax due.
CP3219A	The IRS has received information that is different from what you reported on your tax return. This may result in an increase or decrease in your tax.
CP3219N	The IRS didn’t receive your tax return, so it calculated your return based on the information received from employers, financial institutions, and others. If you want to challenge the proposed tax, you have 90 days from the date of this notice. If you are outside the country, you have 150 days.
Letter 0012C	The IRS needs additional information to process your tax return.
Letter 0484C	The IRS wants a completed
Letter 0525	Updates you on proposed changes after an IRS examination. Any changes are explained and details the refund due or taxes owed.
Letter 531	IRS Notice of Deficiency. The information the IRS received about you was different from what you reported on your return.
Letter 0668D(LP 68)	The IRS released their levy.
Letter 0549C	Your tax bill was paid.
Letter 0681C	The IRS accepted your payment proposal. However, this is not a formal Installment Agreement.
Letter 0757C	You did not adhere to the terms of your Installment Agreement.
Letter LT 11	The IRS plans to seize your property or rights to property.
Letter 1058	The IRS has not received your payment. It plans to seize your property or rights to property.
Letter 1615 (LT 18)	You must respond to the IRS within 10 days of this notice regarding past due tax returns.
Letter 1737 (LT 27)	Complete and sign Form 433F, Collection Information Statement.
Letter 1961C	Your application for a Direct Debit Installment Agreement was declined. It explains why and what you need to do to qualify.
Letter 1962C	Your application for a
Letter 2050 (LT 16)	The IRS is trying to collect unpaid taxes from you from returns that have been filed or from returns that have not been filed.
Letter 2257C	The IRS is providing the payoff amount that you requested.
Letter 226-J	An IRS letter to large employers notifying them that they may be liable for an Employer Shared Responsibility Payment (ESRP).
Letter 2271C	A request for an Installment Agreement has been approved. It explains the fees and how to qualify for a Low Income Fee Reduction. The letter may also request missing information.
Letter 2272C	An IRS letter explaining why your request to pay the balance due in installments was declined.
Letter 2273C	A confirmation letter of your request to pay the balance due in installments. It contained the amount to pay, fees charged, and where to send payment. Instructions on how to apply for the Low Income Fee Reduction included.
Letter 2318C	A response to a request to pay taxes due to payroll deductions. It also explains the fees that are charged.
Letter 2357C	The IRS is admitting that it did not send you the balance due notices that it should have.
Letter 2603C	The IRS accepted your installment agreement. The IRS will file a Notice of Federal Tax Lien on your personal property.
Letter 2604C	The IRS has accepted your request for installment payments. This IRS letter provides the monthly payment, the address where to send it, and the fees charged. The letter also provides instructions on how to apply for the Low Income Fee Reduction.
Letter 2761C	The IRS is requesting your combat zone service dates to ensure that it provides you with the special provisions and protection of the combat zone deferment. Copies of military orders or other documentation to support your time served may be requested. Civilians working in support of the Armed Forces may be required to provide a Letter of Authorization or a letter from their employer.
Letter 2789C	An annual reminder notice, as required by law, of the balance due to the IRS. It explains that penalties and interest continue to accrue until the balance is fully paid.
Letter 2840C	Confirms your Installment Agreement request and includes the payment amount and due date. This IRS letter explains the fees charged for paying monthly and explains how to apply for the Low Income Fee Reduction (if you qualify).
Letter 3030C	Provides an explanation of the tax, penalty, and interest still due on your account.
Letter 3127C	A confirmation of your request to make a change to your Installment Agreement. This IRS letter explains the fees for the change. Changes can be to the payment amount or due date, or it can include additional liabilities.
Letter 3174	A reminder of taxes due after the IRS has sent a Notice of Intent to Levy.
Letter 3217C	The IRS has accepted your request to pay the balance in installments. This IRS letter provides your payment amount, the due date, and fees charged. The letter also provides instructions on applying for the Low Income Fee Reduction (if you qualify).
Letter 3228 (LT 39)	A request to pay the balance due within 10 days using the envelope provided.
Letter 3500	The IRS has received your documents, and it needs additional time to review them.
Letter 3572	Your Federal Income Tax Return has been selected for examination. The IRS auditor requests that you call to schedule an audit appointment.
Letter 4883C	The IRS received your federal income tax return but needs more information to verify your identity in order to process your tax return accurately.
Letter 4903 (LT 26)	You must file your tax returns immediately. The IRS has previously contacted you, but it did not receive a response.
Letter LP 47	The IRS is trying to locate the person identified in the letter and is requesting that you provide their new address.
Letter LP 59	The IRS has not received a response to the notice of levy it previously sent.
Audit Letter 2205	The IRS manages audits either by mail or through an in-person interview to review your records. The interview may be at an IRS office (office audit) or the taxpayer’s home, place of business, or accountant’s office (field audit).
Letter 915	You recently underwent an audit, and the IRS informs you that you now owe taxes.

Key takeaways

The CP259F Notice is sent when the IRS believes you failed to file Form 5227, the Split-Interest Trust Information Return.
If you’ve already filed within the last four weeks, you may disregard the notice, but if you filed with different identifying information, you must respond.
If you haven’t filed Form 5227, you should do so immediately to avoid penalties and interest.
If you believe you’re not required to file, you should still respond and explain your situation to the IRS.
Failing to respond or file can result in penalties, interest, or potential IRS enforcement actions.

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