When slapped with a staggering tax bill, very few people have the luxury of being able to pay the amount due in full. If that is you and you have exhausted all other repayment options, you might consider opting for Currently Non-Collectible Status (CNC). While this option is not for everybody, it can stall the collection process until you can come up with a solution to pay what you owe. We understand the frustration and embarrassment of being in this position and we can help. Keep reading to learn if you are eligible and if you have questions, feel free to give us a call.
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What Are the Rules for an IRS Offer in Compromise
An Offer in Compromise (OIC) is one repayment plan that you can negotiate with the IRS to reduce your tax debt. With an OIC, you are proposing paying a lesser amount to the IRS, based on your ability to pay. This is a good strategy, but bear in mind, that it is not an easy or comfortable process.
How the IRS Conducts Financial Analysis
If you are trying to work with the IRS on an installment payment agreement of your tax debt, you may be wondering exactly how they determine who gets approved and who does not. It probably feels like, “which way is the wind blowing that day?”
How to Navigate IRS Collections Forms
One reason why people get so frustrated with the IRS is because the IRS makes it so onerous to do business with them. There are forms and forms on top of forms, then there are schedules and more documentation and paperwork. There are also pages and pages of instructions, printed in the smallest type possible, which are equally challenging, especially if you are a novice in interpreting IRS guidelines.
What Are IRS Bank Levies? [Definition & Examples]
When the IRS attaches a levy to your bank account, you know they mean business. In short, the IRS can seize your checking and savings accounts and use the funds to satisfy your tax debt.
When that happens you feel helpless. You are facing having literally no money to live on. You are in an impossible situation, or so it feels.
5 Strategies to Resolve Tax Debt with the IRS
Dealing with the IRS is a royal pain, regardless of how much or how little you owe. If dealing with the IRS Automated Collection System (ACS) is making you pull your hair out, here are five strategies that you can use on your own to get through. The good news is that these techniques are simple and do not cost anything. All it takes is a little planning and a lot of patience.
What Are the Consequences of Running from the IRS?
Having tax issues with the IRS is extremely stressful, regardless of how you landed there. First, there is the crushing worry about the financial implications. Nobody likes being in substantial debt, especially, when it threatens your standard of living or the stability of your home or business.
Currently Non-Collectible Status
Now, I want to talk to you about Currently Non-Collectible status. Currently Non-Collectible status or as it’s called in the IRS system, it’s what’s called Code 53, the code that the IRS uses. Currently Non-Collectible status is a temporary hardship status that’s granted from the IRS that frees people from the burden of paying their tax liabilities immediately. It’s like a ceasefire when you negotiate with the IRS. The IRS won’t take any collection activity. The taxpayer doesn’t have to pay any liability. This is usually temporary. It usually lasts for a period of about 18 months. When the IRS places a taxpayer in Currently Non-Collectible status, they will not designate a time that the Currently Non-Collectible status will expire. So, it’s an undefined period before a Currently Non-Collectible status expires. However, usually about the 18-24 month mark after Currently Non-Collectible status has been implemented the IRS will take a review of the account and often ask the taxpayer for updated financial information. Or if you’ve obtained a job, they’ll ask your current information on that. Or, they can ask for a variety of information. In addition, taxpayer should file tax returns showing large swings in income–If your client’s unemployed for a month or for a year, and the next year he gets a $150,000 job and file the tax return reflecting that–that will automatically kick some clients out on the Currently Non-Collectible status. Because of the temporary nature of the status, the IRS can make a determination and kick them out of it at anytime. With that said, it is a viable option for several reasons. Number One, Currently Non-Collectible status will toll the Statute of Limitations. It will cause the Statute of Limitations to keep running.
Frequently Asked Questions About the IRS Collections Process
If I owe money to the IRS, how do they look at credit cards?
