Currently Not Collectible (CNC) status — also referred to as "hardship status" or "53 status" — is a formal IRS designation applied to a taxpayer's account when the IRS determines that attempting to collect the tax debt would create genuine economic hardship. While in CNC status, all collection activity is suspended: no levies, no garnishments, no seizures.
What CNC Status Does and Does Not Do
It does:
- Stop all active collection actions (levies, garnishments, bank freezes)
- Suspend IRS contact for payment
- Allow the 10-year collection statute to continue running
- Give you breathing room to improve your financial situation
It does not:
- Forgive or reduce the tax debt
- Stop interest and penalties from accruing
- Prevent the IRS from filing a Notice of Federal Tax Lien
- Permanently close your case
Who Qualifies for CNC Status?
The IRS evaluates CNC eligibility by comparing your allowable monthly expenses to your gross monthly income. The IRS uses its Collection Financial Standards — published national and local tables — to determine the maximum allowable amounts for housing, food, transportation, and healthcare.
If your gross monthly income minus your allowable expenses is $0 or less, you have a strong case for CNC. If you have a small positive cash flow, the IRS may still grant CNC depending on the size of the balance and other factors.
Income considered:
- Wages, salary, self-employment income
- Social Security, pension, retirement distributions
- Rental income, alimony, and other regular income
Allowable expenses (from IRS standards):
- National standards: food, clothing, household supplies, personal care, miscellaneous
- Local standards: housing, utilities, transportation (ownership and operating costs)
- Actual expenses: health care, court-ordered payments, childcare necessary for work
How to Apply for CNC Status
Contact the IRS by phone () or through a tax representative. The IRS will require you to complete a Collection Information Statement:
- Form 433-A — individual taxpayers (full disclosure version)
- Form 433-F — abbreviated version, often accepted for simpler cases
- Form 433-B — for business tax debts
Provide supporting documentation: recent bank statements, pay stubs, monthly bills, and any special expense documentation (medical, childcare, etc.).
What Happens While You Are in CNC Status
Annual Review: The IRS reviews CNC accounts when you file your annual tax return. If your income has increased enough to support payments, the IRS may remove CNC status and resume collections.
The Collection Statute Runs: Unlike most other pauses (OIC, bankruptcy), CNC status does not toll the 10-year Collection Statute Expiration Date. Every day in CNC counts toward the 10-year clock — which may ultimately benefit you if the statute expires while you remain unable to pay.
New Tax Debt Can End CNC: If you incur a new tax liability while in CNC status, the IRS may use that as a trigger to review and potentially end your hardship designation.
A Tax Lien May Still Be Filed: CNC status does not prevent the IRS from filing a Notice of Federal Tax Lien, particularly on larger balances.
CNC as a Strategic Tool
For taxpayers with large debts, limited income, and few assets, CNC status combined with the running collection statute creates a legitimate path to debt expiration. Find out if you qualify for Currently Not Collectible status by clicking here. If the full 10-year statute expires while the account is in CNC, the debt is legally extinguished.
This is not guaranteed — the IRS monitors CNC accounts and will resume collections if income improves — but for taxpayers in genuine long-term hardship, it is a legitimate outcome.
Transitioning Out of CNC
When your financial situation improves, you may choose to proactively transition from CNC status to another resolution program — an installment agreement or Offer in Compromise — rather than wait for the IRS to resume collections and restart enforcement.