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Currently Not Collectable (CNC)

If a taxpayer does not qualify for an offer in compromise and cannot afford to pay an Installment Agreement, Currently not Collectible (CNC) status may be an option. If a client is placed in CNC status, the statute of limitations continues to run and the IRS will not pursue collection actions. However, If a taxpayer’s financial status improves, the IRS can remove the file from CNC status and return to active collection status.

Reasons for attempting CNC status:

1. Taxpayer has income below allowable expenses and there is no indication that the financial situation will improve in the future;

2. Due to high equity, the taxpayer does not qualify for an OIC and has more allowable expenses than income so an Installment Agreement is not an option; and,

3. Taxpayer has more allowable expenses than income and the statute of limitations is getting close to expiring.

If you would like to learn more about CNC status, contact us at: 1-800-455-6829.