IRS NOTICE REFERENCE
Understanding your CP235 notice
The prior deposit schedule was used. We sent you a notice explaining that your deposit schedule changed, but you didn’t make deposits according to the new schedule and therefore you were subject to a Failure to Deposit p…
General information only. Not legal or tax advice.
Notice details
- Notice code
- CP235
- Category
- Penalty
- Severity tier
- Tier 2 — Action or response expected. The IRS has taken or proposed an action and expects a response or payment.
- Governing law
- §6651; §6662; §6751 (Internal Revenue Code sections)
- Source
- IRS.gov — Understanding Your IRS Notice
What this notice is
The prior deposit schedule was used. We sent you a notice explaining that your deposit schedule changed, but you didn’t make deposits according to the new schedule and therefore you were subject to a Failure to Deposit penalty. Fortunately, we’re able to waive the deposit penalty because your schedule recently changed.
Source: IRS.gov. Reproduced for reference. General information — not legal or tax advice.
What the IRS says to do
Review your deposit requirements. If your total tax in the lookback period was $50,000 or less, you are a monthly depositor. If your total tax in the lookback period was over $50,000, you are a semi-weekly depositor. The lookback period is: for annual returns, the second previous year; for Form 941 the four quarters ending with the second quarter of the previous year. If you used Form 944 in either of the two prior years, the lookback period is the second previous year. for annual returns, the second previous year; for Form 941 the four quarters ending with the second quarter of the previous year. If you used Form 944 in either of the two prior years, the lookback period is the second previous year. Monthly depositors must deposit by the 15th of the following month. If the 15th is a weekend or holiday, the deposit is due the next business day. Semiweekly depositors with payroll on Wednesday, Thursday, or Friday must deposit on the following Wednesday. Those with payroll on Saturday, Sunday, Monday, or Tuesday must deposit on the following Friday. To avoid future penalties, use the correct deposit schedule immediately.
This is the IRS’s own guidance reproduced from the IRS notice page. It describes the IRS’s process — it is not legal or tax advice from TaxRiskOS.
Governing IRS procedure (Internal Revenue Manual)
The IRS’s own internal procedures for handling this notice type are documented in the Internal Revenue Manual:
Reference to published IRS procedure. General information — not legal or tax advice.
Official IRS reference
Read the official notice page on IRS.gov: https://www.irs.gov/individuals/understanding-your-cp235-notice
Related tools
TaxRiskOS is workflow software for practitioners — it captures the notice, computes the deadline, surfaces the escalation tier, and builds a document checklist. It documents process; it does not give advice or draft responses.
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