Taxpayers who can’t pay their past-due tax bills may request a Collection Due Process (CDP) hearing. One married couple filed their 2016 tax return in 2019 but didn’t pay the full tax due of $41,678. After the IRS issued a levy notice, the couple requested a CDP hearing. They asked that their account be considered “currently not collectible,” because their cost of living exceeded their means. An IRS review of their finances showed the couple could pay $62 per month towards their debt, but the couple rejected that plan, stating it “would create an undue hardship.” The U.S. Tax Court found the couple offered no justification for rejecting the plan and the levy was upheld. (TC Memo 2022-30)
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