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What Does Currently Not Collectible Mean?

Harmon Tax Resolution
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There are several options to consider when one has a tax balance owed to the IRS. One can seek an Offer In Compromise; one could utilize Installment Plan options, or most likely as a last resort, to declare a form of bankruptcy. In these options, the tax debt is reduced. However, there is an option that does not reduce the tax debt but provides relief. This option comes when one applies for Currently Not Collectible (“CNC”) – based on a hardship status.

When you cannot afford to pay both your tax debts and your basic living expenses, you may be eligible for what qualifies under the IRS CNC status. If the IRS grants you this status, the IRS will refrain from all collection activities of tax debt, including refraining from garnishing, levying, or placing liens on your property. Once it is established that you can meet your living expenses and pay your tax debts, the IRS will then pursue/resume its collections activities. During this time, they will not solicit payments from you, garnish your wages, or place liens on your property. The IRS will, however, continue to apply penalties and interest to your tax debt. In addition, while there is a balance owed, any future tax refunds will be applied toward this tax debt.

There are a couple of requirements to be considered by the IRS for CNC status. First, you will have to complete a financial analysis to show your financial difficulties to the IRS. A tax attorney, especially with a CPA background, could come in handy to help appropriately portray your financial position. Second, you need to file any delinquent or missing tax returns. Going forward, the IRS will use the future filed returns to evaluate your financial condition for continued CNC status.

The primary purpose of CNC status is to help people deal with financial hardship and not force them into having to use bankruptcy as the only way out. If one needs to use this status, there is no shame to it since it’s meant to be a stop-gap to help people dealing with severe financial needs get back on solid footing. However, it should not be used as a loophole to avoid paying taxes, nor is it for those living well off.

Feel free to contact Harmon Tax Resolution, LLC, if you have any questions. Call today; sleep well tonight.

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I put my trust in him and I so happy I did. He was great about keeping me informed and did what he said he was going to do. I will recommend Harmon Tax services to any one that need it. Plus I will always use him if I ever need him again. Great...

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Unexpectedly, I received an IRS notice stating I had a balance of over $124,000. The IRS debt was very impactful and made me very worried that I could not sleep at night. I sought help from Will. He was able to research and identify the issue...

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For many years of having a small real estate rental business, I started to have many issues with IRS. In desperation I started searching for a Tax Accountant and Attorney. I remarkably came across Will Harmon, and have been very happy and...

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I had a pressing IRS issue that I could not resolve with the IRS. I employed tax attorney CPA Will Harmon to fix this. He immediately addressed the issue with the IRS and another 3rd party, so I did not have to, allowing me to focus on other...

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Attorney Will Harmon provided excellent, trusted representation for me across several issues. There were facets of my situation that required a combination of skillsets, which Will happens to have. In addition to being an attorney, he is also a...

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Absolute pleasure to deal with! IRS came down on me for something i didn't even do. Will took on the task and knocked it out faster than i imagined. Absolutely pleased! Definitely recommend using him for your needs!

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Mr. Harmon is a gentleman always conducted himself in a professional manner. He is very knowledgeable and organized. I can sincerely say he is always a pleasure. He’s an excellent conversationalist and goes out of his way to give his clients the...

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Will Harmon is excellent at what he does and Harmon Associates is the place to go. He is a fantastic person and an expert in taxes and law. Harmon Associates is the best place to go to get excellent results and absolutely excellent service. I...

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