Daniel HawthorneCertified Public Accountant
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Currently not collectible status

Request breathing room when an IRS payment would create hardship.

Currently Not Collectible status may temporarily delay IRS collection when paying the tax would prevent a taxpayer from meeting necessary living expenses. I help document the financial condition and evaluate whether hardship status is the right request.

Currently Not Collectible status is a collection pause—not forgiveness of the tax debt. A complete analysis should consider both the immediate relief and what may happen if your finances improve.

When hardship status may be worth evaluating

  • Your income is insufficient to cover necessary living expenses and an IRS payment
  • Job loss, illness, reduced income, or another major change has affected cash flow
  • A levy or required monthly payment would create immediate financial hardship
  • You have little available equity or borrowing ability after necessary assets are considered
  • The IRS has requested a Collection Information Statement and supporting records
  • You need temporary relief while evaluating a longer-term resolution strategy

How I approach Currently Not Collectible requests

I first confirm filing compliance, the balances involved, and any urgent collection deadlines. The IRS may require current returns before granting hardship status, and an active levy or final notice may require immediate attention while the financial package is prepared.

The financial analysis compares household income with necessary living expenses and reviews assets, equity, accounts, and other resources. IRS collection standards may affect which expenses are allowed without additional explanation. I help organize the documents and explain unusual or necessary costs that are important to the hardship request.

If the IRS approves Currently Not Collectible status, active collection is generally delayed while the financial hardship continues. The debt remains, applicable interest and penalties continue, and the IRS may file a federal tax lien or later request updated financial information. I explain those consequences and help compare hardship status with an offer, installment agreement, or other longer-term option.

What working together looks like

  1. 01

    Identify immediate collection risk

    I review notices, deadlines, levy activity, filing status, and the tax periods included in the IRS account.

  2. 02

    Document the hardship

    We assemble income, expense, asset, debt, and supporting records into a complete financial picture.

  3. 03

    Present the request

    I prepare the Collection Information Statement, explain necessary expenses, and communicate with the IRS.

  4. 04

    Plan beyond the pause

    We review the effect of approval and whether another resolution strategy may become appropriate later.

Every tax matter is fact-specific. Available options and results depend on current agency rules, your compliance history and financial situation, deadlines, and supporting documentation.

Related tax resolution tools

IRS Installment AgreementsOffer in CompromiseTax Penalty AbatementInnocent Spouse ReliefTax Debt & Bankruptcy

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