Short answer
Currently not collectible (CNC) status is the IRS’s hardship pause. If paying anything would leave you unable to meet basic living expenses, the IRS may suspend most collection, including levies. The balance is not forgiven: interest and penalties keep growing, refunds are kept, a lien may be filed, and collection can resume if your income rises.
Key takeaways
- There is no CNC application form. You ask the IRS by phone or through your revenue officer, and back the request up with a Collection Information Statement such as Form 433-F.
- Hardship means you cannot pay reasonable basic living expenses, measured against the IRS Collection Financial Standards. The IRS publishes no income cutoff.
- CNC stops most collection, and the IRS must release a wage levy once it agrees your tax is not collectible. Interest and the full failure-to-pay penalty keep running; the reduced 0.25% (IRS.gov, 2026) rate applies only to payment plans.
- The 10-year collection clock keeps running during CNC, so some balances expire while the account is paused.
- The IRS rechecks your income, mainly through the returns you file each year, and can reactivate collection if it rises.
What currently not collectible status means
“IRS hardship program” is how most people search for it, but the IRS’s own name is currently not collectible. On its temporarily delay the collection process page, the IRS says that when you cannot pay because of financial hardship, it may put your account in CNC status. That means:
- it has temporarily suspended most collection activities;
- you still owe the full amount, which is not forgiven or cancelled;
- penalties and interest continue to accrue until you pay the balance in full.
CNC is older than the Fresh Start Initiative, but it sits alongside payment plans and offers in compromise as one of the options people usually mean by Fresh Start relief. It has no fixed length. The IRS says it may review your finances periodically and resume collection if your ability to pay improves. The IRS also uses CNC for other reasons, such as a taxpayer it cannot locate or a business that has closed. This page covers the hardship version, which is the one individuals ask for.
CNC applies to the balances you already owe. It does not cover future years, so you still need to file each return and pay the tax on it, or ask for a payment plan for the new balance.
Who qualifies: the IRS hardship test
The IRS manual (IRM 5.16.1.2.9) says a hardship exists when a taxpayer is unable to pay reasonable basic living expenses. The decision rests on your income, expenses and assets, taken from a Collection Information Statement. Typical cases involve no income or assets, no equity in assets, or income too low to make any payment without hardship. An account should not be reported CNC if you have income or equity the IRS could collect without causing hardship.
Living expenses are measured against the Collection Financial Standards (current version effective 29 June 2026):
- national standards for food, clothing and other items, allowed in full for your family size;
- an out-of-pocket health care allowance per person, on top of health insurance premiums;
- local standards for housing, utilities and transportation, usually the lower of what you spend or the standard;
- your actual costs instead, if you document that the standards don’t cover basic living expenses.
Example (assumed figures): a single filer takes home $2,900 a month, and the allowable expenses under the standards come to $3,050. There is nothing left to pay, so CNC is a realistic request. If the same person took home $3,300, about $250 a month would be left, and the IRS would more likely look at a partial payment installment agreement.
Is there an income limit for CNC?
No published one. The IRS page gives no dollar threshold, and the decision is made case by case from your financial statement. The IRS manual lets employees skip the full financial statement for some smaller balances when, for example, the only income is Social Security, welfare or unemployment benefits, or the taxpayer is terminally ill, incarcerated or unemployed with no income. The dollar cutoff for that shortcut is blacked out in the public manual.
Filing and business rules
The IRS runs a compliance check before it approves CNC and generally expects missing returns to be filed or otherwise resolved. Hardship CNC is for individuals and for sole proprietorships, partnerships and LLCs where a person is personally liable. An operating corporation is handled under different rules.
What CNC does and does not do
| Question | While your account is CNC | Source |
|---|---|---|
| Levies and garnishments | Most collection is suspended. The IRS must release a wage levy as soon as practicable once it agrees the tax is not collectible. | IRS CNC page; IRC 6343(e) |
| The balance | You still owe all of it. Nothing is forgiven. | IRS CNC page |
| Interest | Keeps accruing at the federal short-term rate plus 3 percentage points, reset quarterly and compounded daily (7% (IRS.gov, Jul-Dec 2026) for the current quarter). | IRS quarterly interest rates |
| Failure-to-pay penalty | Keeps accruing at the normal 0.5% (IRS.gov, 2026) a month, up to 25% (IRS.gov, 2026) of the unpaid tax. | IRS failure-to-pay penalty page |
| Tax refunds | Applied to what you owe. | IRS CNC page |
| Federal tax lien | The IRS may file a Notice of Federal Tax Lien. Its manual calls for one when a CNC account’s total unpaid balance is $10,000 (IRS.gov, July 2024 (IRM effective date)) or more. | IRS CNC page; IRM 5.12.2.6 |
| Collection statute (CSED) | Keeps running. CNC is not one of the events that pause the 10 years (IRS.gov, 2026) collection clock. | IRS: time IRS can collect; IRM 5.1.19 |
| Passport | The IRS excludes accounts that are CNC because of hardship from passport certification, and reverses an existing certification once hardship CNC is decided. | IRS passport page; IRM 5.16.1.2.9 |
Myth: the failure-to-pay penalty drops to 0.25% a month in CNC status.
Fact: the reduced rate applies only while an approved payment plan is in effect, and only if you filed on time. In CNC the penalty keeps accruing at the normal rate until it reaches its cap. That is one reason a small monthly plan can cost less over time than CNC.
Myth: once you are in CNC, the IRS has written off your balance.
Fact: the IRS says plainly that the balance is not forgiven or cancelled. It stays on your account, keeps growing, and can come back into collection. It stops being collectible only when the collection statute on each tax year expires.
How to request currently not collectible status
You can make this request yourself. It needs no fee and no special form, just an honest, documented picture of your finances.
- Get current on filing. File any missing returns, or be ready to explain why you weren’t required to file. The IRS checks compliance before approving CNC.
- Gather proof. The IRS may ask for documents that verify your income, monthly living expenses, bank accounts, property and other assets.
- Complete a financial statement. Use Form 433-F or Form 433-A, or Form 433-B for a business. Compare your expenses with the Collection Financial Standards before you call.
- Call the IRS. Individuals call 800-829-1040 (IRS.gov, 2026); businesses call 800-829-4933 (IRS.gov, 2026). You can also call the number on your latest notice. If a revenue officer is assigned, contact that person instead.
- Ask about any levy. If your wages are being levied, ask for the levy to be released as part of the CNC decision.
- Keep the confirmation. Note the date, the employee’s name and ID number, and what was agreed. Revenue officer cases that close as hardship CNC receive a closing letter (Letter 4223).
If collection is causing an immediate hardship and the IRS isn’t responding, the Taxpayer Advocate Service (877-777-4778 (IRS.gov, 2026)) is free. Low Income Taxpayer Clinics can represent eligible taxpayers for free or a small fee.
Annual review: what can end CNC status
CNC status lasts only as long as the hardship does. The IRS manual describes an automatic check. When a hardship account is closed as CNC, it gets a closing code tied to your allowed living expenses. Each year when you file a return, IRS systems compare your total positive income with that level. If your income rises far enough above it, the account can be reactivated for collection. The IRS doesn’t publish the exact trigger amounts. In some cases a revenue officer also sets a follow-up date to recheck your finances.
If that happens, the IRS may resume collection. The usual way to stop it again is a payment arrangement that fits your new income, such as a regular or partial payment installment agreement.
- Keep filing on time. The annual check relies on your returns, a late return adds failure-to-file penalties, and any refund will be applied to the old balance.
- Pay current-year taxes. A new balance you can’t pay has to be dealt with separately.
- Pay voluntarily if you can. The IRS accepts voluntary payments at any time, and every dollar reduces future interest and penalties.
- Consider an offer. Before approving CNC, IRS employees are told to discuss other options such as an offer in compromise. If your hardship is long-term, an offer may settle the balance instead of leaving it to grow.
CNC vs partial payment plan vs offer in compromise
| Feature | Currently not collectible | Partial payment installment agreement | Offer in compromise |
|---|---|---|---|
| Monthly payment | None | What your finances allow, until the CSED | The agreed offer amount, as a lump sum or over 6 to 24 months (IRS.gov, April 2026) |
| Financial statement | Form 433-F, 433-A or 433-B | Form 433-F, 433-A or 433-B | Form 433-A (OIC) or 433-B (OIC) |
| IRS fee | None | Long-term plan setup fee, from $29 (IRS.gov, 2026) (reduced for low income) | $205 (IRS.gov, 2026) plus an initial payment, unless you qualify as low income |
| Interest and penalties | Keep accruing at normal rates | Keep accruing; the failure-to-pay penalty drops to 0.25% a month if you filed on time | Interest stops once the offer is accepted |
| Tax lien | May be filed | Lien determination required | May be filed; released after the offer is paid |
| Collection statute | Keeps running | Paused while pending, then runs | Paused while pending, plus 30 days after a rejection and during an appeal |
| How it ends | Income rises, or the CSED passes | The CSED passes, or the balance is paid | The offer is paid and five years of compliance are met |
For a side-by-side view that also covers the Simple Payment Plan and penalty relief, see Fresh Start options compared. To see how much time is left on each of your tax years, read our guide to the 10-year collection statute.
Frequently asked questions
There is no fixed period. The IRS says it may review your finances periodically and resume collection if your ability to pay improves. In practice it also rechecks the income on each return you file. If your situation doesn’t change, the account can stay CNC until the collection statute on each tax year expires.
Yes. The IRS states that penalties and interest continue to accrue until the balance is paid in full. The failure-to-pay penalty stays at its normal rate; the reduced rate applies only to approved payment plans.
Yes. The IRS applies any federal tax refund you are due to the unpaid balance while the account is in CNC status.
It should. Under IRC 6343(e), once the IRS agrees that your tax is not collectible, it must release a levy on your wages as soon as practicable. Ask for the release when you make the request, and keep a record of the call.
It may. The IRS says it may file a Notice of Federal Tax Lien to protect the government’s interest. Its manual calls for a lien when the total unpaid balance on a CNC account is $10,000 or more.
Yes. CNC is not one of the events that pause the collection statute, so the 10 years clock on each assessment keeps running. If it expires while you are in CNC, the IRS can no longer collect that year’s balance.
Yes. “IRS hardship program” is a common search phrase, not an official program name. The IRS calls it currently not collectible status, or a temporary delay of collection because of financial hardship.
Sources
- IRS: Temporarily delay the collection process (reviewed 13 Jul 2026)
- IRS Tax Topic 202, Tax payment options (reviewed 25 Sep 2026)
- IRM 5.16.1, Currently Not Collectible (3 Mar 2025)
- IRS: Collection Financial Standards (effective 29 Jun 2026)
- IRS: Failure to pay penalty
- IRS: Quarterly interest rates
- IRM 5.12.2, Notice of Lien Determinations (5.12.2.6 filing criteria)
- IRS: Time IRS can collect tax (reviewed 27 Jun 2026)
- IRM 5.1.19, Collection Statute Expiration
- IRS: Revocation or denial of passport in cases of certain unpaid taxes (reviewed 28 Jul 2026)
- 26 U.S.C. 6343, Authority to release levy
- IRS: Offer in compromise FAQs
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