An official website of the United States Government (NON-Prod - Development Environment)There are times where you agree you owe the IRS, but you can’t pay due to your current financial situation. If the IRS agrees you can’t both pay your taxes and your basic living expenses, it may place your account in Currently Not Collectible (CNC) status.
While your account is in CNC status, the IRS generally won’t try to collect from you. For example: It won’t levy your assets and income. However, the IRS will still assess interest and penalties to your account and may keep your refunds and apply them to your debt. You’ll also continue to receive an annual bill from the IRS as required under the law.
Before the IRS will place your account in CNC status it may ask you to file any past due tax returns.
If you request CNC status, generally, the IRS may ask you to provide financial information, to review your income and expenses and decide whether you can sell any assets or get a loan.
The IRS may collect the balance you owe if your financial situation has improved when they conduct an annual review of your income.
The IRS can attempt to collect your taxes up to ten years from the date they were assessed. The IRS may suspend the ten-year period in certain circumstances. The time the suspension is in effect will extend the time the IRS has to collect the tax.
The IRS won’t suspend interest and penalty charges, even if it stops trying to collect the balance due. You may want to consider other possible payment options within your means before asking the IRS to place your account in CNC status.
If you have a notice, use the contact information included there. If you don’t have or have lost your notice, call the following numbers for assistance:
800-829-1040 (or TTY/TDD 800-829-4059) 800-829-4933Contact the Taxpayer Advocate Service, if your problem is causing financial difficulty for you, your family, or your business; or you or your business is faced with an immediate threat of adverse action.
If the IRS sends you a notice about your tax bill, call the number on the notice to discuss your financial situation. The IRS will take your updated information and decide if you still can’t pay your IRS debt and meet your living expenses. Make sure you have all the information about your income and expenses before you call.
You may prevent future tax liabilities by adjusting your withholding, making estimated tax payments or Federal Tax Deposits.
New Tax Reform implementation changed the way the IRS calculates your federal tax. The IRS encourages everyone to perform a quick “paycheck checkup” to ensure you have the right amount withheld.
You may use the IRS withholding calculator to figure your federal income tax and withholding. The withholding calculator is a tool on IRS.gov designed to help you determine how to have the right amount of tax withheld from your paychecks.
When you use the withholding calculator, it will help you determine if you need to adjust your withholding and submit a new Form W-4, Employee’s Withholding Allowance Certificate, to your employer.
If your IRS problem is causing you financial hardship, you’ve tried repeatedly and aren’t receiving a response from the IRS, or you feel your taxpayer rights aren’t being respected, consider contacting the Taxpayer Advocate Service (TAS).
Browse common tax issues and situations at Get Help.
You may be eligible for representation from an attorney, Certified Public Accountant (CPA), or Enrolled Agent (EA) associated with a Low Income Taxpayer Clinic (LITC) for little or no cost. Low Income Taxpayer Clinics also provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language.
