I would start by calling the number on the notice and then also not file a state return with a refund on it until you resolve this issue. Sadly what you mailed in before may still be sitting in a pile of back logged work on a desk somewhere.
https://www.irs.gov/individuals/understanding-your-cp504-notice
What happens if I don't pay or contact the IRS?
If you don't pay the amount due, we may seize ("levy") any state tax refund to which you're entitled. This is your notice of intent to levy as required by Internal Revenue Code section 6331(d).
If you still have an outstanding balance after we seize ("levy") your state tax refund, we may send you a notice giving you a right to a hearing before the IRS Independent Office of Appeals, if you have not already received such a notice. We may then seize ("levy") or take possession of your other property or your rights to property. Property includes:
- Wages, real estate commissions, and other income
- Bank accounts
- Business assets
- Personal assets (including your car and home)
- Social Security benefits
If you don't pay the amount due or call us to make payment arrangements, we can file a Notice of Federal Tax Lien on your property at any time, if we haven’t already done so.
If the lien is in place, you may find it difficult to sell or borrow against your property. The tax lien would also appear on your credit report ― which may harm your credit rating ― and your creditors would also be publicly notified that the IRS has priority to seize your property.
Who should I contact?
If you have any questions about the notice, call us at the number printed at the top of the notice. A customer service representative will assist you.
What if I don't agree or have already taken corrective action?
If you do not agree with this notice, contact us immediately at the number printed at the top of the notice. We will do our best to help you. If you have already paid this liability or arranged to pay it with an installment agreement, you should still call us at the number printed at the top of the notice to make sure your account reflects this.
