CNC Status FAQs
The IRS defines Currently Not Collectible Status as a status delinquent taxpayers qualify for with the IRS that provides a temporary pause on any active collections the taxpayer might have incurred. Additionally, CNC status will temporarily prevent collection enforcement, IRS notices, and levies. Taxpayers actively in CNC status will receive annual notices from the IRS.
In order to qualify for CNC status, taxpayers must be able to provide evidence of financial hardship. The financial hardship must be significant to the taxpayer's livelihood and not just a minor inconvenience. Additionally, taxpayers seeking CNC status must also have on hand:
• The most recent paystub for each job in the past month.
• The most recent bank statements for all received monthly income for the past three months.
• Utility bills for water, electricity, gas, and phone.
• Documentation of any out of pocket medical expenses.
According to the IRS, "hardship" is a financial situation in which the taxpayer cannot afford even basic living expenses. In order to determine your hardship status, the IRS utilizes its Collection Financial Standards. These standards include:
• National Standards: Food, Clothing, and Other Items
• National Standards: Out-of-Pocket Health Care Expenses
• Local Standards: Housing & Utilities
• Local Standards: Transportation
Taxpayers who wish to file for Currently Non Collectible status may apply by filling out Form 433-F, Collection Information Statement and mailing it to the IRS. However, it is in your best interest to seek an experienced tax professional's counsel to achieve optimal results.
The Currently Not Collectible (CNC) status is not a permanent fix and therefore, will not last forever. The time period in which a taxpayer will be protected under CNC status varies, depending on the individual's specific circumstances.
Generally, Currently Not Collectible status will be extended as long as you are unable to pay back your debt.
Yes, the IRS can and will take your tax refund while you are in Currently Not Collectible (CNC) status. Your refund will be put towards your debt and the IRS will continue taking your refund until said debt is paid off. However, if you experience extreme financial hardship, the Taxpayer Advocate Service may be able to secure your refund.
The IRS Currently Not Collectible (CNC) status might not be the appropriate debt relief program for you. It is in your best interest to retain the services of a knowledgeable tax expert who can help you determine the best possible resolution for you. Alternatives to the Currently Not Collectible (CNC) status include:
• Offer In Compromise
• Partial payment plan or Installment Agreement
• Filing for bankruptcy