Individual Currently Not Collectible Status

The IRS individual currently not collectible (CNC) status is a temporary option for taxpayers who are unable to pay their tax debt and cannot afford to make payments on their outstanding balance. The CNC status stops IRS collection activities and provides taxpayers with a period of relief from collection efforts.

To qualify for CNC status, taxpayers must demonstrate to the IRS that they are experiencing a financial hardship and cannot pay their tax debt. The IRS will review the taxpayer’s financial situation, including income, expenses, and assets, to determine if they qualify for CNC status.

If the IRS grants CNC status, it will suspend collection activities, such as levies and garnishments. However, interest and penalties will continue to accrue on the outstanding balance. The IRS will also periodically review the taxpayer’s financial situation to determine if they are still unable to pay their tax debt.

While CNC status provides temporary relief from collection efforts, it is not a permanent solution to tax debt. The outstanding balance will remain on the taxpayer’s record and interest and penalties will continue to accrue. Additionally, the IRS may revoke the CNC status if it determines that the taxpayer’s financial situation has improved and they are able to make payments on their outstanding balance.

Taxpayers who are granted CNC status may want to consider other options for resolving their tax debt, such as an offer in compromise or an installment agreement. These options may provide a more permanent solution to tax debt and may be less damaging to the taxpayer’s credit score.

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