Currently Non Collectible Status

Currently Non-Collectible Status And What It Means. (CNC)

You're Broke!!  You do not have any money and the IRS can not get something from you that you do not have. Simple!

By being broke, the IRS will be required by law to put you on a Currently Non-Collectible Status. Broke means simply that. You actually have absolutely nothing to your name. No home or no equity in your house, no savings, no investments and not much money from your employment or retirement. This is generally great for a year or 2 and then the IRS will re-evaluate from time to time. They have 10 years and if you remain in CNC for that time, the IRS needs to forgive your entire financial obligation quantity. ALL OF IT !!

So how does this Currently Non Collectible program work?

An individual might be considered to be Currently Non Collectible if they satisfy the following:

• If she does not have any assets, for the IRS to levy taxes.
• If he does not have a stable earnings or means to pay the taxes owed.
• If the earnings of the tax payer is less than the minimum that is needed to meet his standard living expenses.

Once an individual is considered as Currently Non Collectible, all the taxes imposed on them get momentarily suspended. Even if a person is thought about to be Currently Not Collectible, he or she is still responsible to pay the cash owed and the interest accrued.

The monetary status of Currently Non Collectible person is kept an eye on, so that he can return to pay taxes as soon as he gets back on track. This is done when in a year, and the IRS also requires the tax payer to send a copy of his income tax return so that they can compare and see that everything matches. This is the factor why the returns need to be accurate with no mistakes in them.

However the story is not over yet. There is yet another choice for the tax payers to be favored by the IRS. If the individual remains to have very little earnings and to be in the Currently Non Collectible status for a period of 10 years, the IRS is accountable to remove all the taxes he owes.

Simply puts, the tax payer does not need to pay any taxes or charges that had actually been imposed on him so far.

So if this is really your circumstance, being proclaimed Currently Non-Collectible is a wonderful alternative for some individuals. If you are getting near to the time that the statute of limitations runs out, your Revenue Officer might get more aggressive and attempt to get you to sign something. Please do not be deceived by this.