If you are unable to pay your tax debt and the IRS cannot collect the money through conventional tax resolution methods, you can apply for the "currently not collectible" status, also known as low cost tax relief. This means that the IRS will not be able to collect any owed taxes or penalties if your wages cover only your necessary living expenses and you have no assets worth levying.

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To qualify for this status, you must meet one or more of the following requirements: unemployment with no other form of income, income from Social Security benefits, unemployment benefits, or welfare, gross annual income falling below $84,000, little or no money left after paying for basic living expenses, or having only a few years left on the 10-year statute of limitations for tax debt collection.

 

To apply for the "currently not collectible" status, it is recommended to consult with a tax attorney or contact the IRS directly and fill out the Collection Information Statement (Form 433-F). Optima Tax Relief provides tax relief services and expert consultation to assist you in resolving IRS back-tax liability.