Glossary

Tax withholding is when your employer takes taxes out of your paycheck and sends it directly to the government. This helps you avoid a big tax bill at the end of the year.

"Uncollectible Status," also known as "Currently Not Collectible," is a designation by the IRS that temporarily halts collection activities when a taxpayer can't afford to pay their taxes. This status doesn't eliminate the debt, but it provides some breathing room.

A wage levy is a legal action taken by the IRS or a state tax agency to seize a portion of your paycheck to pay off unpaid taxes. It's a serious matter that can impact your finances.

Amortization is a way to gradually deduct the cost of certain assets over time. It's similar to depreciation but applies to intangible assets instead of physical ones.

Back taxes are simply taxes that were not paid when they were originally due. Understanding and resolving back taxes is crucial to avoid penalties and legal issues.

The Collection Statute Expiration Date (CSED) is the deadline by which the IRS must collect taxes you owe. Knowing this date is crucial for managing tax debt.

Currently Not Collectible (CNC) status is a temporary designation by the IRS that can prevent them from actively collecting taxes from you if you demonstrate financial hardship. It provides temporary relief from collection actions.

First-Time Penalty Abatement (FTA) is an IRS program offering a one-time reprieve from certain tax penalties for taxpayers who meet specific criteria. It's a chance to get a clean slate if you’ve made an honest mistake.

Form 433-B is an IRS form businesses use to provide detailed financial information when they owe taxes they cannot pay. It helps the IRS understand the business's ability to pay and helps determine the next steps.

An Installment Agreement (IA) is an arrangement with the IRS that lets you pay your tax debt over time instead of all at once. It helps taxpayers manage their tax liabilities when they can't afford to pay immediately.