IRS notice
IRS Notice CP259: What It Means and How to Respond
The IRS shows a business return as required for a period but not filed; there is one notice per form and period.
Reply by the date on the notice
The IRS asks you to file immediately or return the response form by the date on your notice; there is no statutory window on the IRS page.
CP259 means the IRS shows that your business was required to file a specific return, such as Form 941, Form 940 or Form 1120, for the period on the notice and has not. File it right away if it was required, or use the enclosed response form to explain why no return was due; if you filed within the last four weeks under the same name and EIN, the IRS says you can disregard the notice.
What this notice is telling you
- When the business obtained its EIN, the IRS set up filing requirements for certain return types, and one of those returns is missing for the period shown.
- The IRS treats that return as delinquent until it is filed or you show it was not required.
- A separate CP259 is mailed for each form and each tax period the IRS shows as missing, so several can arrive together.
- The notice does not say you owe tax; it says a return is missing.
What to do
List every CP259 you received
Write down the form number and period on each notice. Several notices often point to one underlying problem, such as a filing requirement that was never closed.
Check whether it was already filed
If the return was filed within the last four weeks using the same name and EIN as the notice, the IRS says you may disregard it. If it was filed earlier, keep proof of filing ready.
If the return was required, file it now
E-file through a provider if eligible, or file on paper, with every required schedule. If you cannot pay the full amount shown, file anyway and request a payment plan.
If no return was required, say why
Complete the enclosed response form explaining why, and mail it in the enclosed envelope or fax it to 855-800-5944. Respond even if the business had no employees or activity.
Close requirements that no longer apply
If the business stopped having employees or changed its structure, deal with the filing requirement that is generating the notices so they do not repeat every period.
Why the IRS thinks a return is missing
Filing requirements are attached to an EIN when it is issued and can be added later, for example when a business starts paying wages. The IRS compares those requirements with what it has received. A CP259 can follow when a payroll provider filed under a slightly different name or EIN, when a business stopped paying wages but never filed a final return, or when a business simply fell behind.
Quarters with no wages on Form 941
The Form 941 instructions say that once you file your first Form 941, you must file a return for every quarter, even with no taxes to report, unless you are a seasonal employer or you file a final return. A seasonal employer checks the line 18 box on every Form 941 it files so the IRS does not expect four returns a year. A business that stops paying wages checks the line 17 box and enters the final date wages were paid. Missing either step is a common source of repeated CP259 notices.
Your response depends on which situation applies
| Situation | What the IRS says to do |
|---|---|
| The return was required and not filed | File it immediately with all required schedules, by e-file if eligible or on paper. |
| No return was required for that period | Complete the enclosed response form explaining why, then mail or fax it. |
| No activity, but deposits or payments were made for the period | File a signed return showing the payments; that is the only way to get them refunded. |
| Filed within the last four weeks under the same name and EIN | You may disregard the notice. |
Missing payroll returns and your payroll provider
When the missing return is a Form 941 or Form 940, start with your payroll provider's filing records for that period: whether the return was filed, under which EIN and with what acceptance confirmation. Haigler CPA Group does not process payroll, but we can reconcile what the provider filed against the IRS account, prepare the response, and represent the business with the IRS on the notices. If returns truly were never filed, the business still needs them filed for each missing period.
What happens if CP259 is ignored
The return stays delinquent on the IRS account, and late filing exposes the business to penalties and interest on any tax that should have been reported. Unanswered notices also keep arriving for each period. Responding, even only to say no return was due, is what stops them.
Want a CPA to deal with it?
Bring the notice to a free consultation, in person on James Island or by video. We read it with you, tell you what it means for your account and, if you want us to, take over the response once you sign Form 2848.
Unfiled tax returns — Missed one year or several? We find out what the IRS already has, prepare the missing federal and South Carolina returns, and sort out the balance after they are filed.
Sources
By Haigler CPA Group. Updated . Notices are revised from time to time, so go by the wording and dates on your own notice. The information on this site is general in nature and is not tax, legal, or accounting advice for your situation. Tax law changes and the right answer depends on facts we would need to review with you. Please speak with a qualified professional before acting on anything you read here.
Questions about CP259
We had no employees that quarter. Do we have to answer a CP259 for Form 941?
Yes, always respond. The CP259 page says no return is required for a period with no employees or activity, but the Form 941 instructions say that after your first Form 941 you file every quarter, even with nothing to report, unless you are a seasonal employer or filed a final return. Check which applies before deciding between filing a zero return and returning the response form.
Why did we get several CP259 notices on the same day?
The IRS mails one notice for each form and each tax period it shows as delinquent. Five missing quarters of Form 941 can mean five notices.
We made tax deposits for a quarter but had no wages. Can we get them back?
According to the IRS, you must file a signed return showing those deposits or payments to receive a refund of them.
Can we fax our CP259 response?
Yes. The IRS accepts the response form by fax at 855-800-5944, including from an online fax service, though it suggests checking that service's privacy and security policies first.
Other notices
- CP161: Unpaid balance on a business tax accountA bill for an unpaid balance on a business tax account, often after a return was filed without full payment or deposits came up short.
- CP162: Penalty for not e-filing a partnership returnA penalty charged to a partnership that filed its return on paper when the IRS says it was required to file electronically.
- CP2100 / CP2100A: Payee name and TIN mismatches on your 1099sSent to payers whose information returns had missing, incorrect or mismatched payee names and TINs; it starts the B notice and backup withholding process.
- IRS notice lookupEvery IRS notice carries a code. Find yours below to see what it generally means, which date matters, and what to do before that date passes.
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