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In the IRS’s own words · not reviewed by VALID
CP156 notice explained, in the IRS’s own words
We applied the sequestration reduction rate to the refundable portion of your credits because the Balanced Budget and Emergency Deficit Control Act (BBEDCA) of 1985 requires it. We made adjustments using the information you provided.
Read the full CP156 page on irs.gov ↗
What this notice is about
We applied the sequestration reduction rate to the refundable portion of your credits because the Balanced Budget and Emergency Deficit Control Act (BBEDCA) of 1985 requires it. We made adjustments using the information you provided.
We received your forms, which may include:
- Form 990-T, Exempt Organization Business Income Tax Return:
- Form 8941, Credit for Small Employer Health Insurance Premiums, for the cited tax period claiming the Credit for Small Employer Health Insurance Premiums, or
- Form 3800, General Business Credit, claiming the Elective Payment Election (EPE).
What is sequestration and how does it affect my Credit for Small Employer Health Insurance Premiums?
See Small Business Health Care Tax Credit Questions and Answers: Calculating the Credit for more information.
How does sequestration apply to an Elective Payment Election?
See FY 2024 effect of sequestration on Inflation Reduction Act of 2022 (IRA) Elective Payment Elections (EPE) for more information.
What to do next
- Write down the date on the letter today.
- Look the number up on irs.gov yourself. Don’t trust a link or phone number from anyone else.
- If it says you owe money or proposes changes to your return, take it to a licensed CPA, EA or tax attorney before that date.
Not advice. Not a filing. Verify with a licensed professional. Rules change by year and facts.