A CP-297A notice is a warning sent by the U.S. Internal Revenue Service (IRS) notifying a person that they have failed to make payments against a tax debt as instructed in previous letters, and that the IRS has therefore issued a tax levy. A tax levy authorizes the IRS to seize money from government payments (such as social security benefits), pay checks from employers, and even the contents of bank accounts. Information about the CP-297A form, formally known as the Notice of Levy and Notice of Your Right to a Hearing, is available on the IRS website.
The CP-297A tax levy notice is only sent out after you have failed to respond to previous warning notices, such as the CP-90 and CP-297 notice. It will include full details of the taxes and interest penalties which the IRS believes the recipient owes them. It will also warn that a levy has been issued to collect the taxes. Subsequent levy notices may also be issued if the first round does not fully cover the debt; these subsequent levies can involve seizure of property, automobiles, bank accounts, and so on. Essentially, the IRS adopts increasingly punitive and encompassing measures until it has the money it is demanding. This is why it is fundamentally important to begin working out tax payments as early and as quickly as possible - before collections begin. Even if you cannot pay the entire tax owing at once, you may qualify for an installment plan.
A tax levy is a serious matter, since it means that the federal government's tax agency is allowed to seize your assets or your income in order to pay off the tax debt. For this reason, it is imperative to take immediate action if you receive a CP-297A notice, even if you believe it was sent to you in error. The IRS gives recipients thirty days after a CP-297A notice to protest the decision and demand an appeal, known as a Collection Due Process Hearing. This hearing will allow recipients who disagree with the tax levy to explain the circumstances. The IRS will then issue a ruling on the appeal, which may under some circumstances then be appealed to a tax court if it is unfavourable. The IRS supplies forms to request an appeals hearing online (Form 12153). People wishing to challenge an IRS assessment may also want to consult a specialized tax lawyer, especially if the sum in question is very large or will result in severe financial hardship.
Full details about the IRS's tax collections process as a whole are available in that agency's Publication 594.