Glossary

Tax debt forgiveness is when the IRS or state tax agency agrees to cancel some or all of the taxes you owe. It can provide a lifeline for individuals struggling with tax burdens.

A tax refund offset occurs when the government takes part or all of your tax refund to cover certain outstanding debts. It's important to understand this process to anticipate any potential impact on your tax refund.

A tax return transcript is a summary of your tax return information from the IRS. It’s not a copy of your actual tax form but an official record of what the IRS has on file.

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.