Are you currently not collectible?

If the IRS has determined that you don’t have the money to pay your tax bill at this time, then they will not take any enforcement action against you. This is called Currently Not Collectible status and it can be a great way to avoid further penalties from accruing on your unpaid balance. However, there are some things that need to happen in order for you to qualify for this status. You must owe $50,000 or less and have no open installment agreements with the IRS. Additionally, if you do owe taxes but meet all of these other criteria then we can help get your account into Currently Not Collectible status so that we can stop interest from accruing on your debt and give us more time to work out a payment plan with the IRS before they start taking enforcement actions against you like wage garnishments or bank levies.

Don’t let those pesky penalties keep adding up! Let our team of experts handle everything for you so that when it comes time for us to negotiate with the IRS on your behalf we know exactly what needs to be done in order for them to agree without any issues! We want nothing more than making sure our clients are happy and stress-free throughout their entire experience working with us which is why we offer free consultations where we go over every single detail about how much money our services cost as well as answer any questions or concerns about anything related

Benefits of Currently Not Collectible

The benefits of currently not collectible are twofold: first, it stops the clock on the statute of limitations for the collection of taxes; and second, it removes assets from the reach of the IRS.

The clock on the statute of limitations is stopped while CNC is in effect, so taxpayers have more time to come up with a payment plan or file an offer in compromise. And since assets are out of reach of the IRS, taxpayers can use them to pay down debt or fund their living expenses without fear that the IRS will seize them.

The drawback of Currently Not Collectible

The main drawback of currently not collectible is that the IRS still holds sway over the taxpayer in a number of ways. For one, assets aren’t shielded from seizure and sale. The government can come after a person’s house, car, bank accounts, and any other valuable property to satisfy an outstanding tax bill.

Another issue is that being labeled currently not collectible can make it difficult to get credit or borrow money. Lenders are understandably reluctant to give loans to people who aren’t paying their taxes. And finally, being currently not collectible doesn’t absolve a taxpayer from future penalties and interest charges on the back taxes owed. So even though there may be some relief in the short term, it’s important to eventually address

Information Required to apply for Currently Not Collectible

To apply for Currently Not Collectible status with the IRS, you will need to provide a lot of information to your tax professional. This includes proof of income, expenses, and assets. You will also need to provide a letter from your doctor stating that you are unable to work due to illness or disability.

If your application is approved, you will not have to pay any taxes on the income you earn during the period of Currently Not Collectible status. However, you will still be required to file tax returns and report all of your income and expenses. Keep in mind that if your financial situation changes at any point, the IRS may revoke your Currently Not Collectible status.

Frequently Asked Questions

1. How much does it cost? It depends on the tax professional and your specific situation, but a good estimate would be $200-$500. The IRS offers a Currently Not Collectible (CNC) status to taxpayers who can demonstrate that they do not have the financial capacity to pay their outstanding tax liabilities. The CNC status is granted for a period of up to two years, after which the taxpayer must submit updated financial information to the IRS. If it is still determined that the taxpayer does not have the financial capacity to pay their outstanding liabilities, then the CNC status will be granted for an additional two-year period.If you are granted CNC status by the IRS, you are still required to file all required tax returns and pay any taxes
2. How long does it take? It takes the IRS anywhere from 4 to 6 weeks to set up Currently Not Collectible. However, the process can take longer if more information is needed or if the case is referred to another department. It’s best to work with a tax professional to determine whether you qualify for Currently Not Collectible and to help expedite the application process. CNC status can provide much-needed relief during difficult times and it’s important to make sure all of the paperwork is submitted correctly so that there are no delays.

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