Currently Not Collectible Assistance

What is Currently Not Collectible Status

Managing Back Taxes: Leveraging CNC Tax Services for Relief and Financial Recovery

Back tax obligations are more manageable when you have support of a CNC tax service. The Internal Revenue Service (IRS) offers ways for you to pause collection activity when you are experiencing financial difficulties. At Polston Tax Resolution & Accounting, we help clients obtain hardship CNC status by completing the necessary research, forms and negotiations. Connect with us to declare hardship and buy time until your financial situation changes.

Tax Hardship Programs — You Have Options With CNC Tax Services

The IRS offers hardship tax relief options for individuals and businesses. If you owe taxes from the last 10 taxable years but lack the income to repay them, you can qualify for CNC Status (Status 53, Currently Not Collectible). The IRS hardship payment alternatives allow you to defer payments if you meet qualifying criteria.

Upon approval, the IRS will pause collection actions around your qualifying tax debt. You can pause payments for tax debt accrued over the past 10 years. However, interest will continue to accumulate. The IRS will review your financial situation every two years to confirm or revoke eligibility.

To qualify for CNC status, you must first prove that your financial hardship is sufficient to render you unable to pay the debt. In most cases, this means the IRS will demand various financial and personal information during the application process.

The Qualification Process

Any taxpayer who cannot make monthly payments on taxes owed may apply for Currently Not Collectible status with the IRS, but they will need to demonstrate their inability to pay.

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. You’ll need to address this risk with strategic solutions to meet your requirements.

You’ll likely follow these main steps in the process:

Apply for CNC status: Any taxpayers unable to pay their monthly tax balance may apply for CNC status. The taxpayer will need to disclose their gross monthly income in the applications process.
Provide a monthly expenses outline: The next step for taxpayers will be to provide an outline of their monthly allowable expenses — costs associated with welfare, health, production of income and other necessary expenditures. To determine how much the taxpayer could pay currently, the IRS needs to see all liquefiable assets.
Calculate back-tax liability: Finally, taxpayers are responsible for calculating their back-tax liability with the IRS. Eligibility for CNC status will usually depend on allowable monthly expenses exceeding monthly income and liquefiable assets being significantly less than total IRS back-tax liabilities.

Keep in mind that if your income status changes at any point, you will most likely lose your CNC status and be required to make monthly payments again.

Applying for CNC Status

You can apply for CNC status by contacting the IRS and requesting that the representative mark your debt as Status 53, CNC. At this time, you will complete Form 433-A, Form 433-F or Form 433-B.

The IRS may request information about motor vehicles, credit reports, real estate and other personal property for cases involving more than $100,000 in debt.

These forms prove your inability to pay back taxes by confirming the following information:

Personal information: Contact information, age, Social Security Number and other personal details
Employment and income information: Job title, pay stubs, employment history and employer contact information
Information about additional sources of income: Retirement pensions, social security payments, alimony, investment dividends and other secondary income
Financial information: Bank accounts, credit cards, investments and insurance policies
Court proceedings: Information about any court proceedings against you
Expenses: Three months of utility bills, food expenses, housing expenses, transportation costs, medical bills and other relevant information

CNC Support From Polston Tax Resolution & Accounting

Polston Tax is here to assist you through the processes of declaring hardship and navigating tax debt. We employ financial attorneys who understand IRS hardship programs and will ensure you receive the support you qualify for.

Our support through CNC tax services entail the following:

Financial analysis: We will gather all relevant information about your case from the IRS, including the amount you owe, the years for which you owe and your Revenue Office queue status.
Collections hold request: We will submit a collections hold request to protect you while we perform our analysis.
Hardship planning: We will use our findings to recommend the best tax hardship strategy for your situation.
IRS negotiation: Our team will communicate with the IRS on your behalf to further your CNC request.

Receive Hardship Tax Relief With CNC Tax Services

Polston Tax has more than two decades of experience supporting individuals and businesses through financial hardship and tax debt. We will work closely with you to execute the optimal tax resolution strategy for your situation. To learn more about hardship tax relief or to begin the IRS application process, please contact us online today.

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Polston Tax has extensive experience resolving IRS and state tax issues, reducing or eliminating liens and wage garnishments, assisting with audits, and many more tax and financial-related services.

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Currently Not Collectible