Are you unable to pay taxes because of your current financial situation? Currently Not Collectible status placement may be a good option for you! Polston Tax Resolution & Accounting can help. Give us a call at 844-841-9857, or click the button below to fill out our CONTACT US form so we can get in touch.
Currently Not Collectible status may be a good option for you if you have little to no income. If you cannot pay taxes because your monthly income is less than your monthly expenses, the IRS may allow you to temporarily pay nothing at all and avoid seizure of the few assets you may have. If the amount you pay for food, clothing, health care, housing, transportation and household expenses meets or exceeds the amount of money you make every month, you qualify for a Currently Not Collectible IRS Status.
The Internal Revenue Service may place your account in an IRS Current Not Collectible status automatically if they determine you are unable to pay – however, this does not usually happen. In most cases, you will have to prove your inability to pay by providing evidence and submitting various forms and documentation to prove your eligibility. If you find yourself in a situation where you must apply for Currently Not Collectible status, Polston Tax Resolution & Accounting can provide information regarding the process and whether or not you may qualify.
To be considered for a Currently Not Collectible status, you must meet the IRS’s definition of “significant hardship,” which is only met if the possibility of paying your taxes threatens you with “serious privation.” When analyzing whether your income meets this criterion, the IRS considers interest, dividends, net profits, distributions and other income in addition to your wages. The IRS uses the following requirements to determine if you’re eligible for Currently Not Collectible Status:
- You make less than $84,000 a year.
- You have no leftover money after paying for your basic monthly living expenses.
- You are unemployed and have no additional source of income.
- Your only source of income comes from unemployment, welfare or Social Security benefits.
- Your tax debt collection’s 10-year statute of limitations is about to run out.
Once the IRS has determined that you qualify for Currently Not Collectible status, they will be unable to garnish your wages and levy your bank accounts. This system gives you a respite from tax collection while you are getting back on your feet financially, yet the amount you owe in taxes will not go away or decrease. You will still owe all past-due taxes, and they may continue to accumulate penalties and high interest rates.
Find Out Whether You Qualify for Currently Not Collectible Status
Our team can also provide you with ongoing consulting and assistance when it comes time for renewal. IRS Currently Not Collectible (CNC) status is typically reviewed every two years to verify that a taxpayer’s financial situation hasn’t changed. If it is found that the taxpayer no longer requires CNC status, the IRS will take the account out of CNC status and begin collecting taxes. In most cases, CNC status is continued until the collections periods expire. If you are retired, or are sure that your income level won’t change, Currently Not Collectible may be the best option for you.
However, in order to know for sure, contact us today to determine whether or not you qualify. You can call us confidentially at 844-841-9857 or fill out the form below to schedule your free consultation.