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IRS Currently Not Collectible Rule

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Currently Not Collectible, commonly abbreviated as CNC, is a tax program that the IRS offers. When there are certain delinquent tax cases, an IRS Tax Agent may determine that there is no ability to collect the taxes owed – and this is something you need to be aware of.

 

If you, as the taxpayer, fall behind on your returns or in paying your taxes, the IRS is going to attempt to collect from you. This can be done through various methods, including notices by mail, by phone, as well as unexpected and unwelcome visits to your home and work. When all of these attempts fail, an enforced collection may take place – and this can include all sorts of negative actions including a garnishment of wages, tax liens, bank levies, and seizing of property.

 

What you don’t want is for the IRS or State to take so much that it places you in a catastrophic financial hardship. If you can demonstrate this, then the IRS will place your case into a Currently Not Collectible status or CNC.

 

You will need assistance proving an actual hardship as this is not a status that the IRS traditionally likes to use with any kind of consistency. As such, the IRS may view what you call a hardship a personal inconvenience or an economic one.

 

Even when you can qualify for a hardship, in order for the IRS to mark your case as CNC, there are actions that need to be taken. This can include changing withholding’s, becoming current on estimated tax payments, and various important details that only a specialist can truly properly handle.

 

It is also important to note that it is possible for your account to be reactivated. This essentially means that a case is not going to remain in CNC status forever because, at some point, the IRS wants to collect what is owed to them. It is a temporary solution to a permanent problem and there will be penalties and interest that accrue while your case is in the Currently Not Collectible status – CNC.

 

The good news is that you can get help in determining if you are eligible for this status or not. There are various commercials and gimmicks online that say that this is a “program” and available for a “limited time only”. Don’t be fooled by these as these are advertised by companies looking to get money out of you without actually providing assistance.

 

Call us at 833-827-2728 for a free consultation.

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