Home Glossary
The words on the letter, in plain English.
Working definitions for the terms that come up in collection cases. These are summaries, not the tax code.
- Assessment
- The IRS’s official recording of a tax you owe. Interest and penalties can be added after the assessment.
- Currently not collectible
- A status where the IRS pauses active collection because paying would keep you from meeting basic living expenses. The debt remains, and the IRS can review it later.
- Installment agreement
- A monthly payment plan for a balance you cannot pay at once. It must be approved, and you generally need to be current on filings.
- Levy
- The IRS taking property to collect tax. Common targets are wages and bank accounts. A levy is different from a lien.
- Lien
- A legal claim against your property for unpaid tax. A Notice of Federal Tax Lien makes that claim public.
- Offer in compromise
- A request to settle a tax debt for less than the full amount. The IRS accepts one only when the offer reflects what it believes it can reasonably collect.
- Penalty abatement
- A request to remove certain penalties, often when you had reasonable cause or a clean compliance history. It does not erase the underlying tax.
- Revenue officer
- An IRS employee assigned to collect a case through direct contact, usually when the balance or history is more involved than a standard notice.
- Substitute for return
- A return the IRS prepares when you did not file. It typically taxes your income without the deductions and credits you could have claimed.
- Transcript
- An IRS record of your account: what was filed, what was assessed, and which notices went out. It is often the fastest way to see the real status of a tax year.
Not sure which option fits?
Tell us what the IRS sent. A specialist will walk you through the next step.