IRS Hardship Program & Currently Not Collectible Status | Stop IRS Collections

Thinking about IRS enforcement is extremely stressful. You may be facing tax levies, wage garnishment, or other serious actions because of unpaid taxes. What are your options?

If you’re experiencing financial hardship and are unable to pay what you owe, the IRS may put your account on currently not collectible (CNC) status. This hardship relief protects you from collections until your finances improve – and in some cases, it can even last until the debt expires, providing you with permanent relief. 

Requesting CNC status and reviewing your other options is much easier with an expert by your side. Damiens Law focuses on strategy, not just administrative tasks. Contact us for help with CNC status or other tax relief options. We serve Mississippi, Tennessee, and clients across the nation.

Is This Page for You?

You’re in the right place if the IRS is taking action against you, and you can’t afford to pay your tax bill. Damiens Law helps clients in situations like yours.

You may be dealing with:

• A high balance that is more than you can pay
• Defaulted payment plans
• Strained business cash flow due to tax debt
• IRS notices, like CP504 or LT11
• Potential wage garnishment or bank levies

Are you already on an IRS payment plan but struggling to keep up with it? A significant portion of people who set up payments actually qualify for hardship relief. Could that apply to you? Contact us to find out.

What Is the IRS Hardship Program?

CNC status is available to some taxpayers experiencing financial hardship. It is a temporary delay on the collections process, and the IRS will not continue its enforcement actions while the status is in effect. 

Here are other quick facts about CNC status:

• Pauses IRS collections
• Is only temporary and is removed once your situation improves
• No garnishments or levies while active
• Not a form of debt forgiveness, but can lead to the debt expiring after the collection statute of limitations runs out.

Anytime you hear about an IRS hardship program, it is CNC status. We can help you determine eligibility and send information to the IRS for review. It’s available for individuals and some businesses, too.

How Damiens Law Can Help

Our attorneys and tax specialists have helped many clients with financial hardship cases, including in these situations:

• Individuals living paycheck to paycheck with tax debt
• Self-employed or 1099 earners with inconsistent income
• Businesses struggling to meet payroll and tax obligations
• People facing imminent enforcement actions
• Taxpayers with older debt nearing the 10-year statute
• Those who don’t qualify for or sustain payment plans
• Taxpayers who can’t make a lump sum payment on an offer in compromise

You may be eligible for CNC status if you’re dealing with a similar hardship. Contact us for an in-depth case review. But remember to act quickly because tax problems escalate aggressively.

How IRS Tax Problems Escalate

If you’re facing IRS action and can’t afford your tax bill, it’s important to act immediately to avoid serious risks. Ignoring IRS notices and simply doing nothing can lead to:

• A growing balance with additional penalties and compounding interest
• IRS notice escalation, from balance due notices to notice of intent to levy
• Enforcement through levies, wage garnishments, or federal tax liens, which impact income, assets, and the ability to get credit
• Business disruption or closure
• Loss of negotiation power over time
• Increasing stress and emotional toll

While these are serious escalations, there are ways to prevent your situation from getting that far. Damiens Law will evaluate your situation and guide you through the CNC status request process.

How Our Firm Secures CNC Status for Clients

Here’s a look at how our process works when you decide to work with us on your IRS financial hardship case:

Immediate Action

• File a Power of Attorney
• Take over IRS communication on your behalf
• Request collection holds to stop IRS enforcement

Financial Analysis

• Develop an in-depth understanding of your case
• Review income, expenses, assets, and IRS standards

Customized Strategy

• Compare CNC to other options to make sure it’s the best fit:
  • Offer in compromise to settle for less than you owe
  • Payment plan to make monthly payments on your debt
  • Partial payment installment agreement with special terms and lower payments
  • Penalty abatement to get rid of penalties and reduce your balance
  • Innocent spouse relief when the liability is due to your spouse or former spouse
• Create a plan of action for resolution and future tax compliance

Negotiation

• Present the hardship case clearly and strategically
• Provide supporting documents on request
• Prove to the IRS why you need collections to stop now

Ongoing Monitoring

• Track financial status and statute expiration timelines
• Alert you if the IRS is changing your statue
• Help you stay in compliance moving forward

Our founding attorney, Joseph Damiens, tackles your entire resolution strategy, going well beyond form submission or administrative work. We look at every angle to get you the most relief possible.

Real Case: How CNC Eliminated $70,000 for Our Client

We’ve helped clients just like you lower their tax liability and get back in good standing with the IRS. In one such case, our client faced an imminent IRS tax levy and had around $100,000 in tax debt.

The client had already received final IRS notices, including CP504 and LT11. Within weeks, we secured a collection hold for the taxpayer to prevent the levy from taking effect. We used an approach that combined CNC relief with the statute expiration date to deliver the best possible outcome for the client. 

About $70,000 of the debt was close to expiring – once the CSED hit on that portion of the liability, the client didn’t need to pay it. The remaining $30,000 was still due, but because we’d secured CNC status, the client was protected from IRS collections on that amount as well. 

Is IRS Hardship the Right Resolution Option?

CNC status isn’t the only option when you can’t afford your tax bill. Let’s review when CNC may be the best option and the other paths you could take when it’s not:

Currently Not Collectible

If you’re going through a temporary hardship and cannot afford your tax payment, even with a payment plan, CNC status could be your best option. Typically, you will have to show that you are having trouble paying your basic living expenses and cannot reasonably pay the IRS because of your hardship.

Installment Agreements

If you can’t afford your full balance but can make regular monthly payments, we can help you look at an installment agreement. Most taxpayers qualify for this type of payment plan, and the IRS won’t escalate collection actions as long as you stay current on your agreement.

Partial Payment Installment Agreements

Partial payment agreements allow you to pay a lower monthly payment, and the goal is usually to pay that low amount until the CSED expires.

Offer in Compromise

You may also qualify for an offer in compromise, which allows you to settle your debt for less without waiting out the CSED. This option also requires careful review by a legal professional to ensure you have a strong application.

Penalty Abatement

If penalties make up a large part of your outstanding balance, you may be able to get some of it waived with penalty abatement, whether for reasonable cause or first-time penalty abatement.

Why You Should Hire Damiens Law for CNC Status Help

Some taxpayers with tax debt may not need a tax attorney. If you can pay off your balance in full or request a simple payment plan, your case is likely manageable on your own. 

However, you should hire legal help if:

• You’re facing levies, wage garnishment, or liens
• Your tax balance is high
• You’re not sure which resolution option is right for you
• Your financial situation is complex
• You’re experiencing relief and need professional help securing CNC status

Damiens Law helps you avoid costly mistakes when you owe money. We bring these advantages to your IRS hardship case:

• Certified tax attorneys — the highest level of credentials of any tax professionals
• Years of experience handling complex tax cases
• Proven strategies for CNC and CSED cases
• Direct negotiation with the IRS
• Serving nationwide clients, with offices in Mississippi and Tennessee
• Focusing on broader tax strategy

We help clients stay protected in CNC status or consider other resolution options when necessary. Get in touch with us to find out how we can help you.

FAQs About the IRS Hardship Program

Does the IRS have a hardship program?

Yes, the IRS offers currently not collectible (CNC) status to taxpayers who are going through financial hardship and cannot afford to pay anything on their tax debt. It is a temporary status that is either removed when your situation improves or when the statute of limitations for collections has expired (10 years).

Is currently not collectible status the same as tax forgiveness?

No, CNC status is not a form of forgiveness. Your balance remains while your account is in CNC status, and you must once again pay when your finances improve. However, if the CSED expires while your account is in CNC status, the IRS can no longer collect that amount.

Do I qualify for IRS financial hardship relief? 

The IRS reviews each case to assess eligibility. They will look at your income, monthly living expenses, bank accounts, property, and other assets to get a picture of your financial situation. If the IRS finds that you cannot reasonably be expected to pay your balance even through a payment plan, they may grant your request.

How long does CNC status last?

It varies. Whenever your situation improves and you can afford to pay, the IRS will remove the status and start collections again. If your situation doesn’t improve before the CSED, then the applicable tax debt is no longer collectible.

Can the IRS levy my assets during hardship status?

No, the IRS will suspend collection activities when your account is in CNC status.

Talk to a Tax Attorney About IRS Hardship Relief

Experiencing financial hardship can be stressful, especially when you owe the IRS money. The sooner you act, the more options you have for resolution, including CNC status or other relief options. 

Talk to our attorneys for a confidential, no-pressure consultation. We’ll provide guidance on your best path forward. 

Contact Damiens Law to get started.