Tax Debt Relief Glossary

The IRS collection system runs on its own vocabulary — acronyms and form numbers that mean nothing until you owe money, and then suddenly matter a great deal. Short, plain-English definitions, each linked to the full guide where it's relevant.

Bank Levy

A one-time IRS freeze on whatever is in a bank account the day the levy is served. Funds are held for 21 days before the bank sends them to the IRS. Full guide →

CDP Hearing (Collection Due Process)

A formal appeal you can request, generally within 30 days of a Final Notice of Intent to Levy, that halts most collection action while it's reviewed and preserves your right to petition U.S. Tax Court. Full guide →

CNC (Currently Not Collectible)

A status the IRS places on an account when it agrees you can't pay your taxes and your basic living expenses. It pauses active collection but doesn't erase the debt, and interest keeps accruing. Full guide →

CSED (Collection Statute Expiration Date)

The date the IRS's legal window to collect a debt generally ends — usually 10 years from assessment, though certain events (like an Offer in Compromise under review) can pause, or "toll," the clock.

Enrolled Agent (EA)

A tax practitioner licensed directly by the IRS (rather than by a state, like CPAs and attorneys) who is authorized to represent taxpayers before the IRS on any tax matter.

Fresh Start

An umbrella term for a set of IRS collection-relief options expanded starting in 2011 — not a single program or application. Full guide →

Form 433-A (OIC) / 433-B (OIC)

The detailed Collection Information Statement backing an Offer in Compromise — 433-A for individuals, 433-B for businesses — documenting income, expenses, and assets. Full guide →

Form 656

The actual Offer in Compromise application. Full guide →

Form 12277

The application to withdraw a filed Notice of Federal Tax Lien, removing the public notice even though the tax is still owed. Full guide →

Installment Agreement

A monthly payment plan with the IRS — short-term (180 days or less, no setup fee) or long-term (with a setup fee, waived or reduced for low-income taxpayers). Full guide →

NFTL (Notice of Federal Tax Lien)

The public filing that puts your creditors on notice the IRS has a legal claim to your property. Different from a levy, which is the actual taking. Full guide →

OIC (Offer in Compromise)

An agreement to settle a tax debt for less than the full amount owed, approved when the offer reflects the most the IRS can realistically expect to collect. Full guide →

RCP (Reasonable Collection Potential)

The IRS's calculation of the most it can expect to collect from you — your asset equity plus a multiple of your future monthly income. It decides whether an Offer in Compromise is accepted. Full guide →

Wage Garnishment (Wage Levy)

A continuous IRS levy on wages — it applies to every paycheck, not just one, until released. A portion of wages is exempt under IRS tables. Full guide →