Currently Not Collectible Status

Whether it’s because of unexpected and unfortunate events or a simple mistake, people can fall behind in paying their taxes to the IRS. If you owe back taxes because of your current financial situation and are unable to pay your tax liability at this time, there are several things that you can do to get caught up as quickly as possible. One of those options is to receive tax relief from the IRS, which could include:

• Standard Installment Agreements

• Partial Pay Installment Agreements

• Offer in Compromise (OIC)

• Currently Not Collectible Status

• Penalty Abatements

A Currently Not Collectible status might be an option if you’re unable to pay taxes because of financial hardship. Each program has its own requirements and deadlines, so it’s important to know what each option entails before applying for any of them.

What Does “Currently Not Collectible” Mean?

If and when your tax debt is considered by the IRS to be “Currently Not Collectible,” the government organization has determined that you do not have enough income and/or assets to cover all of your outstanding tax liabilities. Once the IRS reaches this determination, it will stop all collection efforts, including levies. However, in order to receive this status, you must be able to prove that you are unable to pay anything on the amount owed at this time due to your current situation.

Are You Eligible for Non-Collectible Status?

To qualify for non-collectible status, you will need to meet certain requirements. When the IRS makes their determination, they will consider:

• If you can prove that your monthly income is not enough to pay your necessary living expenses and pay the IRS.

• If you are unemployed and do not receive any additional income.

• If your income is solely based on government benefits, including unemployment, disability, welfare, or Social Security.

As mentioned previously, it is important to understand that CNC status is only one of several relief options offered by the IRS to help taxpayers that are struggling financially. Some of these programs allow you to reduce or eliminate your tax liability while others offer forgiveness of penalties and interest. To understand which tax resolution strategy is best for you, it is important to consult with a qualified and experienced tax lawyer to help you understand your complete financial picture.

How an Experienced Tax Lawyer Can Help with Tax Collections

Taxes can be confusing, but they don’t have to be. The best way to navigate your taxes is to hire a tax lawyer who has experience in dealing with IRS issues and can help you understand how it all works.

At JD Tax Law, we are a full-service tax law firm with a proven track record of success. We represent individual and business taxpayers and defend them against tax collections, oftentimes by providing relief through CNC status. Our team has over 15 years of experience dealing with the IRS, and we have successfully resolved countless tax issues and provided relief for hundreds of clients.

To get a tax resolution plan that is tailored to your specific tax situation, please contact us for a free, no-obligation consultation.
Schedule a time that works best for you, or just give us a call now!