You may be granted IRS Currently Not Collectible status if you lack the funds to satisfy your tax debt and cannot make monthly payments. Unfortunately, the IRS can be demanding when it comes to collecting back taxes and will consider someone “CNC” only if they meet certain requirements.
Currently Not Collectible Requirements
Luckily, there is no standard income amount to qualify for the Currently Not Collectible program and there are many ways in which you may qualify. Typically, a Currently Not Collectible candidate must meet the following criteria:
- Unemployed or on a fixed income
- Unable to cover monthly living expenses
- No assets to satisfy the tax debt
- No equity to satisfy the tax debt
If your allowable monthly expenses exceed your monthly income, and your assets do not cover your tax liability, you will likely qualify for CNC status. This means that you will not be required to make any payments and all collection actions will cease. Keep in mind that this is not a permanent solution. If your financial situation improves, you will be expected to make payments or face collection actions.
How to Request Currently Not Collectible Status
You can apply for Currently Not Collectible status by submitting IRS Form 433-F, Collection Information Statement. There are two pages to complete, and you must submit information about your income and debts, including:
- Bank account and lines of credit
- Real estate and other assets
- Credit card balances
- Business information (if applicable)
- Employment information
- Monthly living expenses
Before submitting your Form 433-F, be sure to contact the IRS and request an updated tax balance due. This should include your tax debt owed, as well as all penalties and interest.
At Tax Assistance Group, we can help you gather the necessary documentation, complete IRS forms, and file an appeal if needed.