Currently Not Collectible (CNC) means that a taxpayer has no ability to pay his or her tax debt. When the taxpayer demonstrates they are in a severe financial hardship and have no ability to make monthly payments or liquidate assets to pay their back taxes, the IRS can declare the account “currently not collectible.” For the IRS to consider a CNC status, an agent will need to review detailed financial information and substantiate the documentation of the applying taxpayer.
Once the IRS declares a taxpayer CNC, the IRS must stop all collection activities, including levies and garnishments. The IRS must send an annual statement to the taxpayer stating the amount of tax still owed. This annual statement is not a bill. While in CNC status, the 10-year statute of limitations on tax debt collection is running and, if they cannot collect back taxes within this period, the tax debt will expire.
This is an excellent option for tax debtors who have found themselves in financial hardship.
Contact Direct Tax Relief at (800) 505-4134 for your FREE Tax Resolution Analysis to see if a Currently Not Collectible status applies to your situation.