Currently Not Collectable

If you are unable to make any monthly payments, you can request Currently Not Collectable (CNC) status. If CNC is approved, the IRS will temporarily suspend collection action against you. CNC status prevents levies against your income and bank accounts, but WILL NOT prevent the filing of a Federal Tax Lien.

 

In order to qualify for CNC status, you must provide a Collection Information Statement (CIS) that proves your inability to pay (i.e. your monthly expenses exceed your monthly income). Like with a Non-Streamlined Installment Agreement, your monthly expenses are limited to “allowable” expenses per IRS standards based on your State and County of residence.

 

IRS can remove your CNC status if your financial situation is deemed to have improved enough to make payments towards your IRS balance.

ADVANTAGES	DISADVANTAGES
Collection of your tax debt is placed on hold	Penalties and interest continue to accrue
IRS will not levy your income or accounts	CNC status can be removed if your financial situation improves
Does not extend the 10-year collection statute of limitations
You can be placed in CNC status even if you have some equity

---