FTB Hardship Deferral vs IRS Currently Not Collectible (CNC)
Introduction: You Can Pause Collections — But Only If You Apply Correctly
If you're facing aggressive tax collections from the IRS or California Franchise Tax Board (FTB) but truly can’t afford to pay, you may qualify for one of two underutilized—but powerful—programs:
- IRS Currently Not Collectible (CNC)
- FTB Hardship Deferral
Both stop garnishments and levies—but they’re not equal.
This guide compares both programs and shows Orange County taxpayers how to pause collections legally and safely.
✅ What Is IRS Currently Not Collectible (CNC)?
CNC means the IRS acknowledges your inability to pay and temporarily halts enforcement.
- ✅ No garnishments
- ✅ No levies
- ✅ No required monthly payments
- Interest/penalties continue
- Reviewed annually
Requires full financial disclosure using IRS Form 433-A or 433-F.
✅ What Is California FTB Hardship Deferral?
California’s version of CNC, but less structured and more difficult to secure.
- Stops levies/garnishments temporarily
- Requires hardship documentation
- May require a hardship letter or CPA submission
- Can be shorter in duration than IRS CNC
- Reviewed less predictably
👉 How the FTB Evaluates Your Ability to Pay
🔍 Side-by-Side Comparison
| Feature | IRS CNC | FTB HArdship Deferral |
|---|---|---|
| Stops Collections | ✅ Yes | ✅ Yes |
| Payments Required | ❌ No | ❌ No |
| Interest Accrues | ✅ Yes | ✅ Yes |
| Annual Review | ✅ Yes | ❌ Not always |
| Process | Formal via Form 433-A/F | Less formal, more variable |
| Easier to Get? | Moderate | Harder |
✅ Who Qualifies?
- Income barely covers living expenses
- No significant assets
- May be elderly, disabled, medically impacted, or unemployed
- In compliance with filings
✅ Documents You’ll Need
- Income proof (paystubs, Social Security, etc.)
- Expense breakdowns (rent, medical, car, food)
- Asset listings
- For FTB: Hardship letter, supporting bank statements
- For IRS: IRS Form 433-A or 433-F
✅ What Happens Next?
- If approved, collections stop
- The debt remains
- You must maintain compliance (file returns, avoid new debt)
- If financial situation improves, collections may resume
✅ How Boulanger CPA Helps
We help clients in Anaheim, Santa Ana, Irvine, Fullerton, and across Orange County:
- Apply for FTB or IRS hardship relief
- Stop wage garnishments and bank levies
- File back tax returns
- Transition from hardship to settlement (Offer in Compromise)
📞 Call
657-218-5700
🌐
www.orangecounty.cpa
Frequently Asked Questions
Does CNC or hardship relief erase the tax debt?
No — it only pauses collections while your financial hardship continues.
Do I need a CPA to apply?
Not required, but it significantly improves your approval odds and documentation quality.
Will my bank levy stop if I apply?
Usually yes — a levy release can be requested during hardship processing.
📣 About the Author
Marc Boulanger, CPA is the founder of Boulanger CPA and Consulting PC, a boutique tax resolution firm based in Orange County, California and trusted by high-income individuals and business owners across Southern California.
With over a decade of experience resolving high-stakes IRS and State tax matters, Marc brings strategic insight to complex cases involving wage garnishments, bank levies, unfiled returns, and six-figure tax debts. He is known for helping clients reduce or eliminate tax liabilities through expertly negotiated settlements and compliance plans.
Marc is a Certified Public Accountant licensed in California and Oklahoma, and is recognized for delivering results—not call center promises. Every case is handled with discretion, strategy, and high-level representation.
📍 Learn more at www.orangecounty.cpa or call (657) 218-5700.
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