The Situation
Evan, a warehouse associate, faced a $47,200 federal tax balance after an injury that stopped regular wages. Available cash was needed for ordinary, necessary living costs, making even a small collection payment difficult at the time.
The Resolution Strategy
The team organized disability benefits, treatment-related costs, and household statements and evaluated whether paying the IRS would prevent the taxpayer from meeting reasonable, basic living expenses. The request focused on Currently Not Collectible hardship treatment and disclosed all income and assets. Penalties and interest can keep accruing while the account is in CNC status.
The Outcome
The outcome is that the IRS records the account as Currently Not Collectible and temporarily suspends most collection actions while hardship persists. The $47,200 balance is not forgiven, and interest and penalties can continue. Collection can restart after financial circumstances change.
Names have been changed and photos are representative stock images used to protect client privacy. This case describes an individual situation. Eligibility and outcomes depend on each taxpayer's circumstances, are not typical or guaranteed, and past results do not predict future outcomes.
