Currently not collectible
What do I need to know
If you can’t pay your taxes right now, but know you owe the IRS and have an honest plan to get ahead of your tax bill, it may be time to consider Currently Not Collectible (CNC) status.
There are times where you agree you owe the IRS, but you can’t pay due to your current financial situation. If the IRS agrees that you cannot both pay your taxes and your basic living expenses, it may place your account in Currently Not Collectible (CNC) status. The IRS is not allowed to take money from a taxpayer who is unable to pay all of their tax obligations at any given point in time.
While your account is in CNC status, the IRS generally won’t try to collect from you. For example: It won’t levy your assets and income. However, the IRS will still assess interest and penalties to your account and may keep your refunds and apply them to the debt. You’ll also continue to receive an annual bill from the IRS as required under federal law.
It’s important to note that while you are in CNC status, you should not expect any changes on your accounts with nationwide tax resolution company, until after we have received all of our client files and verified that we have no issues with their accounts prior to opening them back up again.
How will this affect me?
If your account is placed in CNC status, the IRS may keep your tax refunds and apply them to your debt.
- The IRS may keep your tax refunds and apply them to your debt.
- You can still make voluntary payments.
- The IRS shouldn’t take your assets or income unless you owe federal taxes and won’t be able to pay them.
- Even if your account is placed in CNC status, the IRS may still file a Notice of Federal Tax Lien (NFTL). The filing of an NFTL can affect your credit rating, and your ability to sell property or other assets.
- The IRS may contact you to update your financial information to be sure your ability to pay hasn’t changed.
- The IRS is required by law to notify the State Department if you are certified as owing a Seriously Delinquent Debt. But, the IRS has discretion to exclude debts from Passport Certification, that are CNC.
What does this mean for you? If your debt is considered seriously delinquent and you have applied for a passport, it may be removed from consideration for Passport Certification. This means that your travel document will not be valid when you travel internationally, even if all other requirements are met.
What if I still can’t pay in the future?
If you get a notice from the IRS about your tax bill, call them! They will take your updated information and decide if you still can’t pay your debt and meet your living expenses. Make sure you have all the information about your income and expenses before you call.
If you have questions about how best to avoid paying taxes, you may want to consider adjusting your withholding, making estimated tax payments, or making Federal Tax Deposits.
The IRS withholding calculator is a tool on IRS.gov designed to help you determine how much tax to pay each month, so you can keep more of your money.
When you use the withholding calculator, it will help you determine if you need to adjust your withholding and submit a new Form W-4, Employee’s Withholding Allowance Certificate, to your employer.
You may also use this tool if you are self-employed or if your employer does not withhold taxes from your paycheck.
I need help
While there are many tax help companies out there, we’re here to help you with your taxes. The Nationwide Tax Resolution is a company with professionals that helps taxpayers and protects taxpayers’ rights. We can offer you help if your tax problem is causing a financial difficulty, you’ve tried and been unable to resolve your issue with the IRS, or you believe an IRS system, process, or procedure just isn’t working as it should. If you qualify for our assistance, which is always free, we will do everything possible to help you.
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