IRS CP508C Notice: What It Means and How to Deal with It
The IRS sends out dozens of different notices to taxpayers, but few are quite as serious as CP508C. If you’ve received this notice, the IRS is telling you that your tax debt is seriously delinquent and they’re reporting it to the U.S. State Department. This could affect your ability to get or keep your passport.
Although this is obviously a serious situation, you still have options. The IRS is still willing to work with you, but you do need to act quickly to address your tax debt and avoid losing your passport. Learn more about what the CP508C notice is, how it may affect you, and what to do next. Or to get help now, contact us at McLaud Law P.C. today.
Key Takeaways
- If your tax debt reaches the seriously delinquent threshold, the IRS will send you Notice CP508C.
- At the same time, the IRS will certify the debt to the State Department.
- The State Department can deny your passport application, refuse a renewal request, or even revoke your passport.
- In 2025, a seriously delinquent tax debt is when you owe $65,000 or more.
- You may reverse the certification by setting up an installment agreement or offer in compromise.
Why You Received a CP508C Notice
CP508C, “Notice of certification of your seriously delinquent federal tax debt to the State Department,” is reserved for tax debts that total more than $65,000 as of 2025. This amount is adjusted each year for inflation. This amount includes the initial tax debt, interest, and penalties.
The IRS only sends this notice after they have filed a Notice of Federal Tax Lien and all administrative remedies have lapsed or been exhausted. They may also take this step if they have issued a levy to collect what you owe.
Certain tax debts are not considered seriously delinquent, even if they are more than $65,000 or the applicable threshold for the current year. This includes:
- debts being paid by IRS-approved installment agreements,
- debts being paid off via an offer in compromise,
- debts suspended due to an innocent spouse relief request, or
- FBAR penalties.
The IRS will also not certify anyone as seriously delinquent if they are in currently not collectible status, have a pending request for an installment agreement or offer in compromise, are a victim of tax-related identity theft, or have an IRS-accepted adjustment that will satisfy the debt or reduce it to under the threshold.
It’s important to note that the IRS does not send CP508C out of nowhere. This notice comes after a long list of IRS notices, starting with CP14 and eventually resulting in LT11 or Letter 1058 arriving via certified mail. The IRS can only certify your tax debt to the State Department if they have placed a lien on your assets. In some cases, certification does not come until a levy has been issued.
How the CP508C Notice Impacts You
When the IRS sends a CP508C to taxpayers, it also sends your information to the U.S. State Department. When that happens, you may face several consequences.
- If you apply for a passport, the U.S. State Department will likely deny your application and refuse to issue you your passport.
- If you already have a passport, the State Department will likely deny a renewal request.
- The Department may also revoke your current passport.
Beyond the ways in which this notice affects your passport, it is also a sign that your tax debt is growing rapidly. Interest on tax debt compounds daily, so your tax debt can grow much more quickly than other types of debt. As of the third quarter of 2025, the interest rate for most tax debts is 7%. If you owe $65,000—the minimum needed to be considered seriously delinquent—your tax debt will grow by about $380 every single month. That’s before you account for compounding (when interest stacks on top of interest) or any penalties that may also be accruing each month.
How to Resolve a CP508C Notice
There are several ways you may resolve your CP508C notice to keep your passport and avoid referral to the State Department. The IRS will reverse the certification when the tax debt is no longer seriously delinquent, fully paid, or legally unenforceable. Here are the options:
- Make a payment to get your tax debt under the threshold – but remember that interest and penalties will grow the debt quickly. So if you make a partial payment, you should also look into other resolution options to deal with the remainder of the tax debt.
- Look into an installment agreement – if you can afford monthly payments, this tends to be the easiest option. You can get up to 10 years to make payments. The IRS will not certify your debt or pursue other collection actions while you’re on a payment plan.
- Apply for an offer in compromise – if you can’t pay what you owe over time, an OIC may help you settle your debt.
- Consider currently not collectible status – If you’re experiencing severe financial hardship that keeps you from paying anything toward your tax debt, you can apply for currently not collectible status.
But you need to set up these options before they certify your tax debt to the State Department. After that, it’s still possible to get your passport back, but once the State Department is involved, the matter becomes more complicated.
Getting Your Passport Back
After your tax debt is no longer considered seriously delinquent, the IRS will reverse your certification and notify the State Department within 30 days by sending notice CP508R. You should be able to apply for a passport as soon as the State Department has received the IRS’s notice.
However, once your debt has been certified, making a payment to get it under the threshold will not get your passport back. You have to work with the IRS to get an approved payment plan or settlement if you want your passport back. An experienced tax attorney can be critical in this situation.
If You Disagree With the Amount You Owe
If you disagree with the IRS’s classification of your debt as seriously delinquent, you must move quickly to challenge the notice. The “what you need to do” part of your notice includes a phone number you can call if you want to discuss your concerns directly with the IRS.
However, you may want to talk to a tax attorney first. They can pull your tax transcript and determine whether or not your tax debt is seriously delinquent. If it is, they can communicate with the IRS on your behalf.
Preventing Future Tax Issues
After you have resolved your CP508C notice, the key is to avoid accruing so much tax debt that you become seriously delinquent again. The steps you take to prevent this depend on your circumstances, but in general, you may want to:
- Adjust your withholdings or estimated payments: If your tax debt was the result of inaccurate withholdings or insufficient estimated payments, you can make adjustments now so that you are not surprised with a large tax bill next tax season.
- File on time every year: Filing on time decreases the amount you spend on penalties and allows you to explore resolution options early if you are unable to pay in full.
- Stay on top of your tax resolution agreements: If you took control of your tax debt via an offer in compromise or installment agreement, you have terms and conditions you must meet in order to avoid defaulting. Make sure you’re completely familiar with these requirements so you can stay compliant.
- Communicate with the IRS early: If you do find yourself in a position where you cannot pay in full, reach out to the IRS early on. The longer you wait to address a tax situation, the harder it is to seek relief.
- Hire ongoing tax help: Rather than focusing on your taxes solely in April, consider working with a tax professional who can help you stay compliant and avoid the issues that led to your tax debt initially.
When to Talk to a Tax Professional
If you’re at the point of receiving CP508C, you need to reach out to a tax professional. When you’re this far along in the collection process, the IRS has already filed a lien, you may have lost some of your assets, and your passport is close to revocation. Your tax debt is increasing by hundreds of dollars each month, and unless you take action now, you risk losing important appeals rights that bring opportunities to secure a resolution.
The right tax professional can help you find the right relief option to avoid referral to the State Department, restore passport eligibility, and get your tax debt under control.
If you’ve already received this notice or you know your tax debt is close to the seriously delinquent threshold, it’s time to act—now. Every single day you delay means more interest, higher debt levels, and a bigger risk of travel restrictions. The team at McLaud Law P.C. can help. We work with taxpayers facing serious enforcement actions every single day. We’ll learn more about your situation, help figure out the best path forward, and represent your interests through the process. Call us at 585-397-7785 or get in touch online to get started.
Frequently Asked Questions
What is IRS Notice CP508C?
It’s a notice that the IRS has certified your tax debt as seriously delinquent to the U.S. State Department, which may result in the loss of your passport.
Can I travel with this notice?
As long as your passport is still valid, you can still travel after receiving this notice. The U.S. State Department will contact you directly via mail if they revoke your passport.
What if I’m out of the country when the IRS contacts the State Department?
You will be allowed to return, but after that, your travel privileges will likely be suspended.
How can I stop passport revocation if I can’t pay in full?
You can look into other payment and relief options, including an installment agreement, offer in compromise, or currently not collectible status. Contact a tax attorney for help.
How long does it take to reverse a CP508C?
Once your tax debt is no longer seriously delinquent, the IRS will send you and the State Department a CP508R reversing certification within 30 days.
This communication is Attorney Advertising. It is presented for informational purposes only and does not constitute legal advice. Every legal situation is different, and prior results do not guarantee a similar outcome. This communication does not create an attorney-client relationship between McLaud Law P.C. and the recipient.
Sources:
https://www.irs.gov/individuals/understanding-your-cp508c-notice
https://www.irs.gov/pub/notices/cp508c_english.pdf
https://www.irs.gov/payments/quarterly-interest-rates
https://www.irs.gov/individuals/understanding-your-cp508r-notice