What is Currently Not Collectible
Currently Not Collectible, or CNC, is an IRS status that pauses active collection because your verified income and necessary living expenses leave no money available to pay the tax. Interest and penalties continue to accrue, and federal tax liens may remain, but levies and garnishments generally stop while you are in CNC.
CNC is not a settlement and does not wipe out the balance. It is a protection status that lasts while your hardship persists or until the IRS reviews your case and finds you can afford payments.
For context on how aggressively the IRS pursues collection, see how often the IRS files liens and levies each year.
Who qualifies
- All required tax returns filed and current-year payments up to date, if applicable.
- Verified income and expenses show zero or negative monthly ability to pay.
- No substantial equity that can be liquidated without creating hardship.
The IRS considers household resources. If a spouse or partner shares expenses, that support can factor into the decision. Provide clear evidence of how costs are split.
How to request CNC
- Gather the last 6 to 12 months of bank statements, pay stubs, bills, and any support orders.
- Prepare a financial statement: Form 433-F or 433-A (individuals) or 433-B (businesses).
- Document any expenses above IRS standards with leases, medical letters, invoices, or receipts.
- Submit the package to the IRS and respond to any requests for clarification.
What happens while in CNC
- Levy action usually stops after your case is marked CNC.
- Liens can remain in place until the balance is resolved or the statute expires.
- Interest and failure-to-pay penalties continue to accrue.
- You must file and pay on time going forward; new balances can end CNC.
IRS reviews and when CNC can end
The IRS may review your finances periodically. If income rises or expenses drop, the IRS can move you to an installment agreement or request a new financial statement. If your hardship continues, CNC can be extended. If the collection statute expires while you are in CNC, any remaining balance is no longer collectible.
CNC vs Offer in Compromise vs Installment Agreement
When CNC is best
Use CNC when you have no current ability to pay and expect the hardship to last for a while. It protects you while you stabilize income and expenses.
When an Installment Agreement is better
If you can afford a reasonable monthly payment without missing current taxes, a payment plan can stop additional penalties faster and keep you in compliance.
When an OIC is better
If your asset equity and projected income are low enough that a settlement near realistic collection potential is possible, an OIC may permanently resolve the balance.
FAQ
Will the IRS file a lien while I am in CNC
Yes, the IRS may file or keep a federal tax lien in place while you are in CNC. The lien secures the debt until the balance is resolved or the statute expires.
How long does CNC last
There is no fixed length. CNC continues while your verified finances show no ability to pay, or until the IRS review finds you can make payments, or the statute runs out.
Can I work or earn more money while in CNC
Yes. If income rises, the IRS may request a new financial statement and propose a payment plan based on the updated numbers.
How do I get currently not collectible status
File every required return first, since the IRS will not consider hardship status with returns outstanding. Then document your finances on Form 433-F, or Form 433-A if the IRS asks for it, attach proof of income and expenses, and submit it in response to your notice or by calling the number on it. The IRS compares your income to its allowable living expense standards and places the account in CNC if nothing is left over. Our IRS collection form guides walk through 433-F and 433-A line by line.
Does currently not collectible status stop penalties and interest
No. CNC pauses levies and payment demands, not the accruals. The failure to pay penalty and interest continue to build on the balance the entire time, and the IRS may still file a Notice of Federal Tax Lien. CNC protects your income and assets while you cannot pay; it does not shrink what you owe.
Will I get my tax refund while in currently not collectible status
Do not plan on it. The IRS may keep any federal refund and apply it to your balance while you are in CNC. If you are routinely over-withholding, adjust it, because a refund in CNC is effectively an involuntary payment on the debt.
Does CNC status pause the 10 year collection statute
No, and that is one of CNC's quiet advantages. The IRS generally has ten years from assessment to collect, and unlike a pending Offer in Compromise or a bankruptcy, CNC does not suspend that clock. Time spent in CNC counts toward expiration, so for someone whose finances are unlikely to improve, CNC can carry a balance to its expiration date without a settlement. Estimate your dates with the collection statute estimator.
What does transaction code 530 mean on my transcript
Transaction code 530 is how CNC appears on an IRS account transcript. It marks the account as closed for collection purposes, with a closing code that records the reason, such as hardship. Seeing TC 530 is your confirmation that the status was actually granted. Our transcript code decoder covers the codes you will see next to it.
Is currently not collectible the same as non collectible or hardship status
Yes. The IRS term is Currently Not Collectible, usually shortened to CNC. You will also see it written as non-collectible status, status 53, or hardship status, and they all refer to the same determination that you cannot pay at this time.