Known formally as Letter 2800C, this is an IRS instruction to an employer requiring it to follow a specific income-tax-withholding arrangement for an employee who isn’t having enough income taxes withheld from their wages. Within 60 days of the letter date, the employee can discuss the determination with the IRS before the new withholding arrangement takes effect. After 60 days, the withholding rate “locked in” and the employer must begin withholding at that new rate.

An employer that does not withhold federal income tax as instructed has to pay the additional taxes itself. For more details, see the IRS FAQs on withholding compliance.