Palace, whose own transfer kitty has been swelled by Yannick Bolasie's move to Everton on Monday, lodged a bid that, with add-ons, was thought could rise to £30million.
Benteke is seen as surplus to requirements among the six strikers at Anfield just one year on from his £32.5million switch from Aston Villa, yet the Reds want to recoup as much of that money as possible and have turned down Palace's offer.
Source: PA