# Currently not collectible: how IRS hardship status works Source: https://backtaxesdesk.com/tax-debt-relief/currently-not-collectible Publisher: Back Taxes Desk (backtaxesdesk.com), independent editorial site Topic: Tax Debt Relief Last updated: 2026-09-18 > Currently not collectible (CNC) is an IRS account status that pauses most collection when paying anything toward your tax debt would leave you unable to cover basic living expenses. The debt is not forgiven. Interest and penalties keep growing, the IRS can file a lien and keep refunds, and it may review your finances again later. ## Key facts - Forms the IRS may ask for: Form 433-F, 433-A or 433-B - Income limit: None fixed; based on your actual budget - Interest and penalties: Continue until the balance is paid - Collection period: Not on the IRS list of events that pause it ## What does currently not collectible mean? Currently not collectible is the IRS finding that you cannot pay any of your tax debt right now without giving up necessities such as housing, food or utilities. When the IRS places your account in this status, it temporarily stops most collection, including new wage and bank levies. The balance does not shrink. The IRS states plainly that the full debt is still owed, and it may pick collection back up if your finances improve. Think of CNC as a pause button, not an eraser. CNC differs from a payment plan because you pay nothing each month. It differs from an offer in compromise because nothing is settled and there is no application fee. ## Who qualifies for IRS hardship status The test is whether you can pay both your taxes and your basic living expenses. The Taxpayer Advocate Service notes there is no fixed income limit, so a household with a moderate income but high necessary costs can qualify while a lower-income household with savings may not. ### A worked example Take a retiree whose only income is $2,100 a month in Social Security and who owes $20,000. If rent, utilities, food, insurance, medical costs and car expenses total $2,250 a month, there is no money left for the IRS. That shortfall, backed by bills and statements, is the core of a hardship request. These figures are an illustration, not an IRS threshold. ### What you must show The IRS may ask for a collection information statement: [Form 433-F](https://backtaxesdesk.com/tax-debt-relief/form-433-f) for most individuals, Form 433-A for wage earners and the self-employed, or Form 433-B for businesses. Expect to back it up with documents. ## How to request currently not collectible status 1. File any missing returns first. The IRS expects you to keep filing on time even when you cannot pay. 2. Build a monthly budget with your actual income and necessary expenses, and gather proof for each line. 3. Call the IRS number printed on your most recent bill or notice and explain that paying would leave you unable to meet basic living costs. 4. Complete the financial statement the IRS asks for and send the supporting documents by the date given. 5. Ask the IRS to confirm in writing, or note the date and employee ID, when your account is placed in CNC status. > **If a levy is already in place:** Say so at the start of the call. The IRS says a levy may be released if it is causing an immediate economic hardship, and the sooner your financial statement is in, the sooner that can happen. ## What continues during currently not collectible status CNC stops enforced collection but not the growth of the debt. At the 7% annual underpayment rate that applies for October through December 2026, compounded daily, a $20,000 balance picks up roughly $1,450 of interest over a full year, before any failure-to-pay penalty. - **Interest and penalties** accrue until the balance is paid in full. - **A federal tax lien** may still be filed to protect the government's claim on your property. - **Refunds** are applied to the unpaid debt instead of being sent to you. - **New tax years** must be filed and paid on time; a new balance can bring back enforcement. - **Passport certification** does not apply to debt in CNC status for hardship, so an account in CNC is excluded from the seriously delinquent debt certification described on our [passport revocation page](https://backtaxesdesk.com/irs-collections/irs-passport-revocation). Nothing stops you from making voluntary payments while in CNC. Any amount you send reduces the balance that interest is charged on. ## Reviews and ending currently not collectible status CNC has no set end date. The IRS may contact you later to update your financial information, and if your income has risen or your expenses have fallen, it can resume collection. If a review shows you can now afford something but not the full balance, ask about a [partial payment installment agreement](https://backtaxesdesk.com/payment-plans/partial-payment-installment-agreement) rather than waiting for a levy. If you can pay in full over time, a standard plan keeps the failure-to-pay penalty at the reduced 0.25% monthly rate for people who filed on time. Keep copies of every statement you send. If your situation changes for the worse again, the earlier file gives you a baseline to show what has changed. ## Currently not collectible and the 10-year collection statute The IRS generally has 10 years from the date a tax is assessed to collect it. The IRS list of events that suspend that clock includes pending payment plan requests, pending offers, bankruptcy and Collection Due Process hearings, but not CNC status, so the clock keeps running while your account is paused. That means a person who stays in CNC until the collection statute expiration date can reach the end of the collection period with the balance still unpaid, after which the IRS can no longer collect it. Our guide to the [IRS collection statute of limitations](https://backtaxesdesk.com/irs-collections/irs-collection-statute-of-limitations) explains how to find that date, and [whether the IRS forgives tax debt](https://backtaxesdesk.com/tax-debt-relief/does-irs-forgive-tax-debt) covers why this is expiration rather than forgiveness. For the full set of options, including offers and payment plans, see [back taxes relief options](https://backtaxesdesk.com/tax-debt-relief). ## Common questions ### How long does currently not collectible status last? There is no fixed period. It lasts until the IRS reviews your finances and finds you can pay, you pay the balance, or the 10-year collection period ends. ### Can the IRS take my tax refund while I am in CNC? Yes. Any federal refund you are due is applied to the unpaid balance while your account is in currently not collectible status. ### Do I still have to file tax returns during CNC? Yes. You must keep filing on time. Falling behind on new returns or running up a new balance can end the pause and restart collection. ### Does currently not collectible status remove a tax lien? No. An existing lien stays in place, and the IRS may file a new Notice of Federal Tax Lien even after placing your account in CNC status. ### Is there an income limit for IRS hardship status? No fixed limit exists. The IRS compares your income with your necessary living expenses and your assets, so the answer depends on your whole budget rather than a single number. ## Sources - [Temporarily delay the collection process](https://www.irs.gov/businesses/small-businesses-self-employed/temporarily-delay-the-collection-process) - [Currently not collectible, Taxpayer Advocate Service](https://www.taxpayeradvocate.irs.gov/get-help/paying-taxes/currently-not-collectible/) - [Levy](https://www.irs.gov/businesses/small-businesses-self-employed/levy) - [Time IRS can collect tax](https://www.irs.gov/filing/time-irs-can-collect-tax) - [Quarterly interest rates](https://www.irs.gov/payments/quarterly-interest-rates) - [Understanding your CP508C notice](https://www.irs.gov/individuals/understanding-your-cp508c-notice)