Many taxpayers struggle financially each year, making it difficult for them to fulfill their tax obligations. The IRS provides several options in certain circumstances to lessen the burden. The IRS Currently Not Collectible (CNC) status is one of these options, and it can offer temporary relief to taxpayers who are having trouble paying their tax burden.

What does IRS CNC Status (Currently Not Collectible) Entail? 

An IRS program called IRS Currently Not Collectible  status, commonly referred to as “hardship status,” classifies a taxpayer as temporarily unable to make payments toward its unpaid tax burden. The IRS agreed to cease temporary collection efforts during this time. While this doesn’t get rid of the debt, it gives struggling taxpayers some breathing room.

Who Is Eligible for Status as a CNC?

Your financial situation determines whether you qualify for Currently Not Collectible status. To evaluate if you are unable to make payments, the IRS will examine your income, spending, and assets. Generally speaking, the IRS might give you CNC status if:

• You’re going through an awful lot of financial trouble.
• Your financial situation would suffer if you paid your tax debt.
• Your monthly salary is insufficient to cover your essential living costs.

Perks of Having a CNC Status

Temporary Relief: IRS Currently Not Collectible   status gives you a break from IRS collection activities so you have time to get your finances back on track without the added stress of collection actions.

Prevents Legal Actions: While your debt is still owed, Currently Not Collectible   status prevents the IRS from taking legal action, such as bank levies or wage garnishments.

Asset Protection: Your possessions, such as your residential property, will be shielded from IRS seizure, enabling you to continue living in your current residence.

Expiration of Collection Statute: The IRS only has a certain amount of time to recover tax bills before the collection statute expires. They may finally shut the case if the statute of limitations runs out while the case is in Currently Not Collectible status because the clock on this time frame continues to run.

Disadvantages of CNC Status

Temporary Relief: The IRS Currently Not Collectible   status is a workable temporary fix. Your tax debt does not go away, although it offers immediate relief. The IRS will start collecting again as soon as the CNC status is removed.

Accrual Of Penalties: Interest and penalties continue to be collected on your outstanding debt even while you are in Currently Not Collectible status.

Applying for CNC Status

The IRS must receive a financial statement from you that lists your income, expenses, and assets to process your application for IRS Currently Not Collectible status. This statement will be examined by the IRS to assess your eligibility.

The Role of Tax Relief Companies 

Tax relief companies play a crucial role in helping people and businesses who are facing IRS Currently Not Collectible status and other tax-related difficulties. They give their experience in putting together the financial accounts necessary for Currently Not Collectible   status applications, making sure the data is correct and convincing. Their understanding of IRS policies is of the utmost importance for making a compelling argument to the IRS for CNC status approval.

However, their support doesn’t end there. To help their clients navigate the complex world of Currently Not Collectible status and other tax relief alternatives, tax relief organizations like LifeBack Tax Relief go above and beyond. Their dedication to assisting people reclaim control over their financial lives is demonstrated by examples of real-life accomplishment. Here is an instance of how LifeBack Tax Relief helped one of its clients

Client Testimonials

Meet Jane, a dedicated single mother who got buried in tax debt as a result of unanticipated medical expenses. Along with the strain of her financial circumstances, Jane also had to deal with her anxiety about IRS collection actions. She contacted LifeBack Tax Relief to get help.

In close collaboration with Jane, LifeBack Tax Relief carefully examined her financial condition and ensured that her IRS Currently Not Collectible status application was well-prepared. Their knowledge enabled Jane to obtain Currently Not Collectible   status with success. She got immediate relief from IRS collection efforts, which allowed her to concentrate on getting her finances in order.

This is just one of the numerous successful cases showing how tax relief companies may significantly improve the lives of people who are having trouble with the IRS. You can work towards regaining control of your financial life with their assistance and find the best option for your particular tax debt situation.

The Takeaway

In conclusion, citizens who are having tax debt difficulties might take advantage of the IRS’s current non-collectible (CNC) status.

Remember that the first step to regaining control over your financial situation can be as simple as evaluating the possibilities and asking for help from tax relief agencies