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Collection Due Process vs. Collection Appeals Program

Two routes to the same Appeals office, on different forms, different clocks, and with different endings. One can be reviewed by a court. The other cannot.

Quick Answer

They reach the same office and end differently. A CDP determination can be petitioned to the Tax Court; the instructions to Form 9423 state a CAP decision "is binding on both you and the IRS" and that "you cannot obtain a judicial review". In exchange, CAP reaches things CDP does not — seizures, lien certificate denials, alter-ego and nominee lien filings, installment agreement decisions — and is open to a third party whose property was taken. The instructions do name one route that survives a CAP decision: "a third party may contest a wrongful levy by filing an action in district court." The deadlines are not comparable either. CDP runs on a date printed on a notice; CAP runs on business days from a manager conference, except for installment agreements, which run on 30 calendar days from the action.

1

Collection Due Process (CDP)

Advantages

  • A timely request prohibits levy while it is pending, unless a section 6330(f) exception applies.
  • IRM 5.1.19 states the collection statute is suspended while it runs.
  • A determination can be petitioned to the U.S. Tax Court.
  • It is requested on Form 12153 and sent to the address on the lien or levy notice.

Disadvantages

  • It attaches to a notice. There has to be a lien filing or a levy notice for the right to exist.
  • It runs on a short clock, and the date is printed on the notice.
  • The IRS states you may dispute the existence or amount of the tax only in limited circumstances.

Best For

What it reaches: a Notice of Federal Tax Lien filing, and a levy the IRS proposes or has made where an exception applied.

Typical Cost

The IRS publishes no fee for either route.

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2

Collection Appeals Program (CAP)

Advantages

  • It reaches more actions. The instructions to Form 9423 list levy or seizure taken or to be taken, a Notice of Federal Tax Lien filed or to be filed, a lien filed against alter-ego or nominee property, denials of lien certificate requests including subordination, withdrawal, discharge and non-attachment, and installment agreements rejected, modified or terminated.
  • A third party whose property is subject to a collection action may use it, not only the taxpayer.
  • The IRS states that normally it will stop the collection action you disagree with until the appeal is settled — unless it has reason to believe collection or the amount owed is at risk.
  • For an installment agreement decision the deadline is 30 calendar days rather than business days.

Disadvantages

  • The instructions state: "that decision is binding on both you and the IRS. You cannot obtain a judicial review of Appeals' decision following a CAP."
  • For a lien, levy or seizure you must FIRST request a conference with the deciding employee's manager. The form comes after that.
  • The deadlines are in business days and they are short: two business days to notify after the conference, three for the form to be received or postmarked, four if no manager contacted you, and ten after a Notice of Seizure.
  • The instructions state never to send the request directly to Appeals; it must go to the office that took the action.

Best For

What it reaches: collection actions and installment agreement decisions, whether or not a CDP notice exists.

Typical Cost

The IRS publishes no fee for either route.

The Verdict

They reach the same office and end differently. A CDP determination can be petitioned to the Tax Court; the instructions to Form 9423 state a CAP decision "is binding on both you and the IRS" and that "you cannot obtain a judicial review". In exchange, CAP reaches things CDP does not — seizures, lien certificate denials, alter-ego and nominee lien filings, installment agreement decisions — and is open to a third party whose property was taken. The instructions do name one route that survives a CAP decision: "a third party may contest a wrongful levy by filing an action in district court." The deadlines are not comparable either. CDP runs on a date printed on a notice; CAP runs on business days from a manager conference, except for installment agreements, which run on 30 calendar days from the action.

Frequently Asked Questions

Which one applies to me?
That depends on what you are appealing and whether a CDP notice exists, and this page does not decide it. The instructions to Form 9423 list what CAP reaches; Publication 1660 sets out when a CDP right arises. Read both against the notice you received.
Can I use both?
This page does not assert that you can or cannot. Neither retrieved source states the interaction, and it is not inferred here.
What is the shortest deadline in either?
Ten business days, in CAP, after a seizure. The instructions to Form 9423 state you must appeal to the Collection manager within 10 business days after the Notice of Seizure is provided to you or left at your home or business.
Does either stop collection while it runs?
The IRS states a timely CDP request prohibits levy unless a section 6330(f) exception applies. For CAP, the instructions say "normally, we will stop the collection action(s) you disagree with until your appeal is settled, unless we have reason to believe that collection or the amount owed is at risk." Read the hedges: normally, and unless.

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Sources

Sourced to primary IRS materials and editorially reviewed. Not reviewed by a tax professional. Not tax advice. Report a correction.