Collection Due Process (CDP) Hearing: IRS Appeals Workflow for Practitioners

Collection Due Process is the statutory mechanism Congress created to give taxpayers an independent review of IRS collection action before their property is seized or a federal tax lien is made public. For practitioners, it is also the formal record through which collection alternatives, spousal defenses, and (in limited circumstances) the underlying liability are preserved for Tax Court review. Understanding the procedural machinery of CDP, including the two separate statutory rights, the hard 30-day deadline, the CSED tolling consequences, and the distinction from the Collection Appeals Program, is the foundation for competent IRS collection representation. For the underlying statutory basis, including the RRA 1998 origin of CDP, the full text and structure of the two Code sections, and the Tax Court jurisdiction that reviews CDP determinations, see our IRC 6330 and 6320 Statutory Framework: Hearing Rights, Tax Court Jurisdiction, and 2026 Case Law.

All procedures, deadlines, and regulatory citations in this guide must be verified at IRS.gov and under the current version of IRM 8.22.4 (updated April 2026) before being relied on in any specific client matter. IRM provisions are updated periodically, and any procedural detail printed here may be superseded.

This guide is for informational purposes only and does not constitute legal or tax advice. CDP outcomes are fact-specific and subject to IRS and Tax Court discretion.

Section 1: The Two CDP Rights -- Lien vs. Levy

Congress enacted two separate Collection Due Process rights, codified at different sections of the Internal Revenue Code. The distinction is not semantic: the triggering event, the notice the IRS must send, the collection-suspension effect, and the practitioner's strategic options differ depending on which type of CDP notice is at issue.

IRC 6320: Lien CDP

IRC 6320 is triggered by the filing of a Notice of Federal Tax Lien (NFTL). Once the IRS files an NFTL, it must provide the taxpayer a Notice and Opportunity for Hearing (NOATH) within 5 business days of the NFTL filing date. This notice informs the taxpayer of the right to request a CDP hearing to challenge the lien and propose collection alternatives.

A critical operational point: collection is not automatically suspended during an IRC 6320 lien CDP hearing. The IRS may continue collection activity by means other than the specific lien at issue. The NFTL remains on file. The settlement officer in Appeals independently reviews the matter, but the stay on collection that applies to levy CDP does not apply to lien CDP. Practitioners handling lien CDP matters should assess immediately whether any additional levy or collection action is imminent and whether an IRC 6330 levy CDP notice has also been issued. For the full range of lien-relief certificates (discharge, subordination, withdrawal, non-attachment), see our Federal Tax Lien practitioner guide.

The lien CDP hearing can include a request for lien subordination, withdrawal, or discharge, but the hearing itself does not automatically release or withdraw the NFTL. Those outcomes require specific findings by the settlement officer.

IRC 6330: Levy CDP

IRC 6330 is triggered by a proposed levy action. The IRS must send a levy CDP notice at least 30 days before executing the levy. This advance notice is the window in which the taxpayer may file Form 12153 to request a CDP hearing and halt the levy.

The key operational difference: the levy is suspended while the IRC 6330 hearing is pending (IRC 6330(e)(1)). The IRS cannot execute the proposed levy from the date a timely Form 12153 is filed until the Notice of Determination is issued and (if the taxpayer petitions Tax Court) until the Tax Court proceeding concludes. This suspension is one of the primary strategic reasons practitioners choose CDP over CAP when levy action is the immediate threat.

Both CDP Rights Use Form 12153

Despite their differences, both IRC 6320 lien CDP and IRC 6330 levy CDP are requested using the same form: Form 12153, Request for a Collection Due Process or Equivalent Hearing. The form requires the taxpayer (or representative) to identify each tax period at issue, specify the type of hearing requested (CDP or equivalent), describe the issues to be raised, and identify any collection alternative being proposed. See Section 2 for Form 12153 filing requirements.

Section 2: Form 12153 -- What to File and When

Form 12153 is the exclusive mechanism for requesting a Collection Due Process hearing or an equivalent hearing. There is no substitute form, and verbal requests do not preserve CDP rights. Every element of the form matters: incomplete or misdirected filings can cause the IRS to treat the request as an administrative inquiry rather than a CDP request, which forfeits the statutory rights and CSED tolling.

The 30-Day Deadline

The deadline to file Form 12153 is 30 days from the date printed on the face of the CDP notice. This date is not the postmark date, not the date the notice was mailed, and not the date the taxpayer received it. It is the date that appears on the notice itself. Treat that date as the deadline trigger.

What to Include on Form 12153

A complete Form 12153 should identify:

• Each tax period at issue, matched to the periods covered by the CDP notice
• The type of hearing requested: CDP hearing (statutory, preserves Tax Court rights) or equivalent hearing (administrative only, no Tax Court rights)
• The specific issues the taxpayer intends to raise, including the collection alternative proposed (OIC, installment agreement, CNC, partial pay installment agreement, or lien relief)
• Any spousal defense claim under IRC 6015, if applicable
• A challenge to the underlying liability, if applicable and if the taxpayer did not previously receive a statutory notice of deficiency or have a prior opportunity to contest the liability

Issues not raised on the Form 12153 or at the hearing may be waived. IRM 8.22.4 (updated April 2026) requires the settlement officer to address only the issues the taxpayer actually raises. Do not file a bare-bones Form 12153 that identifies no issues; it signals to the settlement officer that the request may be dilatory and provides no basis for the hearing to proceed productively.

Where to File

File Form 12153 at the address printed on the CDP notice. This address directs the form to the specific IRS campus or processing center that issued the notice. Do not use the standard campus mailing address for the taxpayer's state or the address on the tax return. Misdirected filings create processing delays and can result in a missed deadline finding.

Fax vs. Mail and Proof of Filing

Both fax and mail are accepted methods for filing Form 12153. Retain proof of timely filing in both cases: a certified mail receipt with return receipt (or at minimum a USPS tracking number confirming delivery before the deadline) for mail submissions, and a fax confirmation sheet showing the date and time of transmission for fax submissions. The burden of proving timely filing falls on the taxpayer; document the file accordingly.

File Form 2848 (Power of Attorney and Declaration of Representative) simultaneously with or before the Form 12153. The settlement officer is prohibited from discussing the case with a representative who does not have a valid POA on file. Do not wait until the hearing is scheduled to submit Form 2848.

After the 30-Day Window: Equivalent Hearing

If the 30-day CDP window is missed, the taxpayer may still request an equivalent hearing within one year of the notice date. The equivalent hearing provides administrative review by a settlement officer, and the settlement officer has the same authority to consider collection alternatives, spousal defenses, and procedural issues. However, an equivalent hearing does not toll the CSED, does not provide the right to petition Tax Court, and is treated procedurally as a CAP-like process. The taxpayer retains the ability to raise collection alternatives, but loses the judicial backstop and the CSED tolling that make CDP strategically valuable. See Section 3 for the CDP vs. CAP strategic comparison.

Section 3: CDP vs. CAP -- Strategic Decision for Practitioners

CDP and CAP are not interchangeable, and defaulting to CDP because it sounds more protective is as much of an error as defaulting to CAP because it is faster. The right choice depends on three factors: whether Tax Court judicial review is needed or desired, the CSED status of the tax periods at issue, and the urgency of stopping collection action.

CDP: Statutory, Tax Court Rights, CSED Tolling

CDP is a statutory right created by Congress. A timely CDP request:

• Tolls the CSED from the date Form 12153 is filed until the Notice of Determination is issued, plus 90 days (and further if Tax Court is petitioned)
• Provides the right to petition the U.S. Tax Court to review the settlement officer's determination for abuse of discretion (de novo for underlying liability disputes)
• Suspends the proposed levy (IRC 6330) while the hearing is pending
• Is available once per tax period per type of CDP notice (one lien CDP and one levy CDP per period); it cannot be repeated for the same period and the same type of notice

CAP: Administrative, Faster, No Tax Court Rights, No CSED Tolling

The Collection Appeals Program is an IRS administrative process, not a statutory right. CAP:

• Does not toll the CSED
• Does not provide Tax Court rights; the Appeals decision is final
• Can be used multiple times for the same tax period and the same type of collection action
• Is typically resolved in 60 to 90 days, faster than a CDP hearing
• Is available for a broader range of collection actions (rejected OICs, rejected installment agreements, liens, levies, seizures, and Trust Fund Recovery Penalty assessments)

When CDP Is the Better Choice

CDP is the appropriate path when:

• The client needs Tax Court as a backstop: the underlying liability is in dispute, the settlement officer's decision on a collection alternative is likely to be adverse, or the collection action itself is procedurally defective
• The proposed collection alternative is complex (for example, a large OIC or a PPIA) and the taxpayer needs a formal administrative record to support a Tax Court petition if the hearing goes wrong
• A levy is imminent and the levy suspension under IRC 6330(e)(1) is needed to protect the client's assets while the collection alternative is developed

When CAP Is the Better Choice

CAP is the appropriate path when:

• The CSED is long and the taxpayer simply wants to renegotiate an installment agreement or stop a levy quickly without consuming the one available CDP right for that period
• Tax Court review is not needed or desired, for example where the liability is not in dispute and the collection alternative is straightforward
• The client's collection issue is likely to recur (for example, a business with ongoing payroll compliance issues), and preserving the ability to use CAP multiple times is more valuable than using the one available CDP right now
• Speed is the primary concern and the 60-to-90-day CAP timeline is meaningfully faster than the CDP process for the specific case

Section 4: Issues That Can and Cannot Be Raised at CDP

The scope of issues available at a CDP hearing is defined by statute and IRM 8.22.4 (updated April 2026). Raising issues outside that scope, or repeating issues already litigated, wastes the settlement officer's time and can trigger frivolous argument consideration. Equally, failing to raise an available issue at the CDP stage can foreclose it at Tax Court. Know the boundaries before the hearing.

Issues That CAN Be Raised

• Collection alternatives: Offer in Compromise (OIC), installment agreement (standard or partial pay), Currently Not Collectible (CNC) status, and Partial Pay Installment Agreement (PPIA). The settlement officer can accept or reject any proposed alternative based on whether it meets IRS guidelines; that determination is then reviewable by Tax Court for abuse of discretion. For the statutory authority and three-ground framework for OICs raised as collection alternatives in CDP hearings, including the Tax Court tolling interaction, see the IRC 7122: OIC Statutory Framework guide. A CDP determination that accepts an installment agreement or offer in compromise as a collection alternative triggers mandatory levy release under IRC 6343: Levy Release and Return of Property. An installment agreement proposed as a collection alternative in a CDP hearing is governed by IRC 6159: Installment Agreement Statute, which mandates acceptance for liabilities under $10,000 and governs the terms, CSED tolling, and default notice rules.
• Spousal defenses under IRC 6015: Innocent spouse relief, separation of liability election, and equitable relief are all available in CDP. The settlement officer can consider and grant IRC 6015 relief as part of the CDP determination.
• Appropriateness of the collection action: Whether the specific levy or lien action is appropriate given the taxpayer's circumstances. This includes whether the IRS followed its own collection procedures and whether the collection action is disproportionate to the liability.
• Procedural challenges to the levy or lien: Whether the required notice was properly issued, whether the NFTL was properly filed, and whether the IRS complied with the procedural prerequisites for the collection action.
• Underlying liability (with a prerequisite): The taxpayer may challenge the amount of the underlying tax liability, but only if the taxpayer did not previously receive a statutory notice of deficiency for that period and did not otherwise have a prior opportunity to dispute the liability before the IRS or in Tax Court. Where this right exists, Tax Court reviews the liability de novo (not for abuse of discretion).

Issues That CANNOT Be Raised

• Issues already litigated in Tax Court: If the underlying liability was determined in a Tax Court proceeding, or if any issue was adjudicated in a prior Tax Court case for the same period, that issue is barred by res judicata principles and cannot be re-raised in CDP.
• Issues already raised in a prior CDP or equivalent hearing for the same tax period: Once a CDP hearing or equivalent hearing has been held for a specific tax period and type of notice, the same issues cannot be raised in a subsequent CDP request for the same period and same notice type.
• Frivolous arguments: Arguments with no basis in law or fact, including constitutional challenges to the tax system, arguments that wages are not income, and other positions identified by the IRS as legally frivolous. The settlement officer is required to dismiss these without substantive discussion, and the IRS may assess a frivolous return or filing penalty under IRC 6702.
• Underlying liability where a prior opportunity existed: If the taxpayer received a notice of deficiency and had the right to petition Tax Court (even if they did not), that constitutes a prior opportunity to dispute the liability. The underlying liability cannot be raised again in CDP. Verify the transcript for notices of deficiency (TC 494, TC 495) before representing that the client has no prior opportunity.

Section 5: The CDP Hearing Process Under IRM 8.22.4

Once a timely Form 12153 is filed and processed, the case is assigned to a settlement officer in the IRS Office of Appeals. The settlement officer is not the same individual as the Revenue Officer or ACS unit that issued the CDP notice; this separation is the structural independence that makes CDP meaningful. The settlement officer reviews the administrative file and the taxpayer's proposed collection alternatives and issues a Notice of Determination.

Conference Format

CDP hearings are conducted as a conference between the taxpayer (or representative) and the settlement officer. The conference may be in person, by telephone, or by correspondence (written exchange). The taxpayer and representative may request a specific format, but the settlement officer has discretion to determine the appropriate format based on the complexity of the issues and the available resources of the Appeals office. In practice, telephone conferences are common for straightforward collection alternative matters; in-person conferences are more typical for complex cases with disputed liability issues.

What the Settlement Officer Reviews

The settlement officer reviews: the administrative file (the tax account transcript, assessment history, and prior collection actions), the taxpayer's proposed collection alternative (with supporting financial disclosure), any procedural issues raised on the Form 12153, and any spousal defense documentation. The settlement officer may request additional financial information (Form 433-A, 433-B, or 433-F, depending on the case) and supporting documentation during the pre-conference period.

Respond to information requests promptly. A failure to provide requested financial information can result in the settlement officer making a determination based on the information available, which typically means a determination adverse to the taxpayer.

Timeline

IRM 8.22.4 (updated April 2026) does not set a hard deadline for the settlement officer to issue a Notice of Determination; it requires the determination to be issued within a reasonable time. In practice, CDP hearings commonly take 3 to 6 months from filing to the Notice of Determination, depending on the complexity of the issues raised and the Appeals caseload. CSED tolling continues throughout this period.

Notice of Determination

The Notice of Determination is the final document from the IRS Office of Appeals. It sets out the settlement officer's findings on each issue raised, the outcome of any proposed collection alternative, and the IRS's determination of whether the collection action (levy or lien) was appropriate. It also notifies the taxpayer of the 30-day window to petition Tax Court under IRC 6330(d)(1).

The Notice of Determination date is important for two reasons: it starts the 30-day Tax Court petition clock, and it is the date on which the 90-day CSED tolling add-on begins to run (the CSED extends 90 days past the Notice of Determination date, plus additional time if Tax Court is petitioned).

Section 6: Tax Court Appeal After CDP

The right to petition Tax Court is what distinguishes a CDP hearing from every other administrative collection process. The window is short and the standard of review matters: understanding both before the hearing is necessary to advise the client on whether to accept the Notice of Determination or petition.

The 30-Day Petition Deadline

The taxpayer has 30 days from the date of the Notice of Determination to file a petition with the U.S. Tax Court under IRC 6330(d)(1). The petition deadline is not extended by mailing time or any other grace period. Calendar the petition deadline from the date on the face of the Notice of Determination immediately upon receipt.

If the taxpayer does not petition Tax Court within 30 days, the Notice of Determination becomes final. The IRS may then resume collection action (lift the levy suspension, or proceed with lien enforcement) without further notice.

Standard of Review

The Tax Court reviews CDP determinations under two different standards, depending on the issue:

• Abuse of discretion: For collection alternative determinations (OIC, IA, CNC, PPIA), appropriateness of the collection action, and procedural issues, the Tax Court asks whether the settlement officer's determination was arbitrary, capricious, or contrary to law. The taxpayer bears the burden of demonstrating abuse of discretion; the Tax Court does not substitute its judgment for the settlement officer's on matters within the officer's discretion.
• De novo review: For underlying liability disputes (raised under the prerequisite described in Section 4), the Tax Court reviews the merits of the liability independently of the settlement officer's analysis. This is a higher-stakes and more resource-intensive Tax Court proceeding.

Collection Suspension During Tax Court Proceedings

During the Tax Court proceeding following a timely CDP petition, IRS collection action remains suspended. The IRS cannot execute the levy at issue (for IRC 6330 matters) while the case is pending in Tax Court. This suspension continues until the Tax Court decision becomes final.

If the taxpayer prevails in the CDP Tax Court case, attorney fees and costs may be recoverable from the IRS. CDP hearing participation before Appeals satisfies the IRC 7430 exhaustion-of-administrative-remedies requirement in collection-based Tax Court cases. See our IRC 7430 Attorney Fees After a CDP Case guide for the prevailing party standard, the qualified offer rule, and the net worth limits that govern fee recovery.

Section 7: CSED Tolling During CDP

The Collection Statute Expiration Date (CSED) is the date on which the IRS's statutory authority to collect a tax liability expires. Under IRC 6502, the IRS generally has 10 years from the date of assessment to collect. CSED tolling events extend that window; CDP is one of the most significant tolling events in practice.

How CDP Tolls the CSED

Under IRC 6330(e)(1), the CSED is tolled from the date the taxpayer files Form 12153 until the Notice of Determination is issued, plus an additional 90 days. If the taxpayer petitions Tax Court after the Notice of Determination, the CSED continues to toll until the Tax Court decision becomes final, plus an additional 90 days. For the full statutory reference for CSED tolling events, including the CDP hearing suspension under IRC 6330(e)(1) alongside bankruptcy, OIC, and TAO tolling, see our IRC 6503: SOL Tolling and CSED Suspension guide.

In a CDP hearing that takes 5 months to resolve and is then followed by 12 months of Tax Court litigation, the CSED for the affected periods can be extended by 17 months or more before the extra 90-day periods are added. For periods that were already close to the CSED when the CDP notice was issued, this extension can be decisive.

Equivalent Hearings Do NOT Toll the CSED

An equivalent hearing (requested after the 30-day window, within one year of the notice date) does not toll the CSED. The collection clock continues to run throughout an equivalent hearing. This is a critical distinction when the CSED is the taxpayer's primary collection strategy asset: filing an equivalent hearing instead of a timely CDP request, or allowing the CDP deadline to lapse, forfeits the CSED tolling benefit.

CNC Does NOT Toll the CSED

Currently Not Collectible status does not toll the CSED. The collection clock continues to run while an account is in CNC status. This is one of the defining strategic differences between CNC and CDP: when the CSED is close to expiring, CNC lets the clock run (which may be exactly what the practitioner wants), while CDP tolls the clock (which extends the IRS's collection window). See the CNC practitioner guide for the full CNC vs. CDP CSED analysis.

Practical Implication: Calendar CSED Before Filing CDP

Before filing Form 12153, compute the CSED for every tax period at issue, accounting for any prior tolling events visible on the account transcript (TC 520, TC 550, prior OIC submissions, bankruptcy). For CSED computation methodology, see our CSED guide. If the CSED is within 12 to 18 months, the CSED impact of CDP is a material factor in the decision to proceed. In some cases, the answer may be to negotiate a collection alternative through CAP or direct negotiation with ACS or the Revenue Officer, and reserve CDP for a later notice, rather than consuming the CSED tolling now.

Section 8: Interaction with Other Collection Tools

CDP does not operate in isolation. Practitioners must understand how a pending CDP hearing interacts with the major collection resolution tools: OIC, installment agreement, CNC, and the federal tax lien.

OIC During CDP

The settlement officer has authority to accept an Offer in Compromise proposed during a CDP hearing. If the taxpayer proposes an OIC as the collection alternative, the settlement officer reviews whether the proposed offer amount meets or exceeds the Reasonable Collection Potential (RCP) under IRM guidelines. The IRS levy remains suspended while the OIC is pending in Appeals as part of the CDP matter.

If the settlement officer rejects the OIC within the CDP hearing and issues a Notice of Determination to that effect, the taxpayer has 30 days to petition Tax Court to review that determination for abuse of discretion. This is the judicial backstop that CDP provides and that CAP does not. See the OIC practitioner guide for RCP calculation methodology and OIC eligibility standards.

Installment Agreement During CDP

If an installment agreement is established as the collection alternative during a CDP hearing, the hearing typically resolves without a formal Notice of Determination. Instead, Appeals issues a closing agreement that memorializes the installment agreement terms. Because no Notice of Determination is issued, the Tax Court petition window does not open. The taxpayer accepts the installment agreement terms as the resolution, and the levy suspension (for IRC 6330 matters) ends once the IA is accepted.

CNC During CDP

The settlement officer can place an account in Currently Not Collectible status as the outcome of a CDP hearing. The levy remains suspended while the CDP matter is pending; once CNC is established in Appeals, the account is coded accordingly and the levy suspension ends as a practical matter because the account is no longer being actively collected. However, as noted in Section 7, CNC does not toll the CSED after it is established; the CDP tolling that was running during the hearing stops once CNC is the resolved outcome and the hearing closes.

For the full mechanics of CNC, including financial hardship standards, ACS vs. Revenue Officer procedures, and re-activation triggers, see the CNC practitioner guide.

Federal Tax Lien and NFTL CDP

An IRC 6320 lien CDP hearing can include a request for lien subordination, lien discharge, or lien withdrawal. However, the hearing itself does not automatically release or withdraw the NFTL. The settlement officer must make a specific finding that lien relief is appropriate, and the standard for each type of lien relief (withdrawal under IRC 6323(j), discharge under IRC 6325(b), or subordination under IRC 6325(d)) is set by statute and IRM procedure. Even if the CDP hearing results in a favorable determination on lien relief, the NFTL remains on file until the specific lien relief action is executed.

Section 9: Common Practitioner Errors in CDP Matters

CDP is a procedurally unforgiving process. The errors below are the most common in practice and the most costly for clients, because most of them are irreversible once the deadline passes or the issue is waived.

Miscalculating the 30-Day Deadline

The single most common and most damaging error: using the date the client received the CDP notice as the deadline trigger instead of the date printed on the notice itself. A notice dated 30 days ago that the client just brought to you may already be at or past the CDP deadline. When a client brings in any IRS collection notice, the first action is to read the date on the notice's face and calculate the deadline immediately.

Requesting CAP When Tax Court Rights Are Needed

Using CAP when the client's situation requires Tax Court review permanently forfeits the statutory CDP right for that notice. Once the 30-day CDP window has closed without a timely Form 12153, and the client has pursued CAP instead, the only remaining route is the equivalent hearing (no Tax Court, no CSED tolling) or direct negotiation with the collection function. Evaluate Tax Court necessity before selecting the process.

Raising Issues Already Litigated

Presenting a settlement officer with an argument that was already decided in Tax Court for the same period, or repeating an issue from a prior CDP hearing for the same period, is grounds for dismissal of that issue and may invite consideration of a frivolous filing penalty under IRC 6702. Pull the Tax Court docket and the prior CDP history from the transcript before drafting the Form 12153.

Failing to Track CSED Tolling After CDP Is Filed

Once Form 12153 is filed, the CSED begins to toll. Practitioners who do not calendar the tolling period and update it as the hearing progresses can lose track of the true CSED and advise clients incorrectly on when the collection statute expires. Maintain a CSED tracking log for every CDP matter and update it at each stage: Form 12153 filed, Notice of Determination received, Tax Court petition filed, Tax Court decision final.

Not Filing Form 2848 With the CDP Request

The settlement officer cannot communicate with a representative who does not have a valid Form 2848 (Power of Attorney and Declaration of Representative) on file with Appeals for the periods at issue. Filing Form 12153 without a corresponding Form 2848 means the hearing may proceed without the representative being notified or consulted. Submit Form 2848 simultaneously with or before the Form 12153, and confirm it has been processed by calling the Appeals office before the pre-conference period.

Filing at the Wrong Address

Filing Form 12153 at the standard IRS campus address for the taxpayer's state, instead of the address printed on the CDP notice, creates processing delays and can result in a missed deadline finding if the form is rerouted by the IRS after the deadline date. Use only the address on the CDP notice.

Frequently Asked Questions

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