Currently Not Collectible, or Hardship Status, means that for the moment, you have no ability to pay the tax owed. The IRS grants this after reviewing financial information from the taxpayer.
Once the IRS declares you Currently Not Collectible, the IRS stops all collection activity against you, including bank levies and garnishments, for a period of two years. The IRS still sends an annual statement reminding you that the obligation, while shelved, has not gone away.
In addition to the respite gained, another benefit to this status is that the 10-year statute of limitations continues to run. If the IRS cannot collect the tax within the 10-year statutory period, then the tax debts will expire.
In many situations where a Currently Non Collectible status can be obtained, an Offer in Compromise can also be an appealing alternative that conclusively resolves the tax problem for less. Alternatively, bankruptcy might be a good solution. At Huntsman | Lofgran, PLLC, we always first sit down with our clients in a free and thorough consultation to determine the best resolution for your situation. Call us at 801-474-0031, or contact us today.
As local Salt Lake City Tax Attorneys focused on IRS Problem Resolution, we can help you decide if Non-Collectible status is the right solution to your IRS tax debt problem. Contact the Law Offices of Huntsman | Lofgran, PLLC at 801-474-0031 or email Wasatch Front/Salt Lake City Tax attorney Michael Lofgran for your free no-obligation, Tax consultation.