It's one of those weird-but-true IRS facts: Barter counts as income. If you trade your web design services for a brand-new kayak, you both owe tax on the fair market value of what you received. The IRS, it turns out, has an opinion on everything.

Speaking of opinions, ours is that you should definitely read this week's newsletter.

This week’s lineup:

• The IRS Snooze Button: When your finances are a hot mess, the IRS might actually agree to back off. Discover how the "Currently Not Collectible" status can buy you the breathing room you desperately need.

• Your Wallet's Secret Weapon: An HSA offers a rare triple-tax benefit that acts as a secret weapon for both healthcare costs and retirement. Find out why it might be the smartest money move you make all year.

• The Queen of Mean's Takedown: Leona Helmsley tried to write off a jade dance floor as a business expense. See how a single quote and a disgruntled employee led to a spectacular trial and an ironic prison sentence.

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Currently Not Collectible: The IRS Snooze Button

If paying taxes was like high school, “Currently Not Collectible” (CNC) would be that cool substitute teacher who wheels in a TV and says, “We’re just watching a movie today!” You still have homework. The midterm is still coming. But for one glorious moment, you get to breathe.

CNC is the IRS’ way of letting you catch your financial breath while they hang back and let you continue racking up interest. Here’s how this rare pause button works, who qualifies, and why it’s less “free pass” and more “timeout with strings attached.”

What “Currently Not Collectible” Means

Let’s say your finances are a hot mess. Your bills are overdue, you’re behind on rent, and the IRS shows up asking for money you don’t have. If you genuinely can’t pay your tax debt without skipping essentials (like housing, utilities, or prescription meds), the IRS may agree to temporarily back off. 

While in CNC, they typically won’t levy your wages or raid your bank account. That’s the good news.

What CNC Isn’t

“Currently Not Collectible” is not forgiveness. Your debt sticks around, interest and penalties don’t stop accruing, and the IRS will keep your refunds like a raccoon in your garbage, hoarding all the shiny things. Plus, you’ll still get annual bills as a mildly terrifying reminder that they haven’t forgotten. 

Do You Qualify?

The IRS wants proof that paying them won’t force you to skimp out on actual needs. That means food, shelter, and medical care. It does not mean extra things like a daily Starbucks latte or a new streaming service.

The IRS will check:

• Your income (wages, benefits, gig work)

• Necessary expenses (rent, groceries, gas)

• Assets and debts (cars, bank accounts, your Beanie Baby collection)

What the IRS Needs From You

You’ll need to start by doing two things:

• File any late returns

• Provide a Collection Information Statement (Form 433-F, 433-A, or 433-B)

Think of this as your financial report card, and the IRS is a very tough grader.

How to Request CNC

If the IRS has already sent you a letter, call the number listed on it. If not, you can try the main hotline at 1-800-829-1040. Be prepared with:  

• Your completed Form 433

• Proof of income and expenses

• A deep, calming breath

They’ll review whether you could feasibly sell something, take out a loan, or make even tiny payments. If not, they may approve CNC.

When your finances are a hot mess, the IRS might actually agree to back off. Discover how "Currently Not Collectible" status can give you the breathing room you desperately need, and what strings are attached.

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An HSA Could Save Your Wallet (and Possibly Your Sanity)

The average American will spend a shocking amount of their life trying to decipher medical bills. They are puzzles with price tags, where a simple visit to the ER can sometimes cost more than a used car.

But there’s a stealthy little hero in this madness: the Health Savings Account (HSA). Not flashy. Not loud. Just the financial equivalent of a pocketknife that unfolds into a chainsaw when you need it most. An HSA offers significant tax benefits, too.

What HSAs Are and How They Work

An HSA is a tax-advantaged savings account that you can use to pay for qualified medical expenses. Think of it as a personal piggy bank for healthcare costs that comes with a rare "triple-tax benefit" from the IRS.

To get an HSA, you need a High Deductible Health Plan (HDHP), which is insurance code for “pay for most things yourself until disaster strikes.” But if you can handle that up-front risk, you unlock HSA access.

In 2025, an individual can contribute up to $4,300, and a family can contribute up to $8,550 per year. Those 55 or older can add $1,000 annually as a catch-up contribution. The most significant advantage of an HSA, however, lies in its triple tax benefits:

• Contributions are pre-tax

• Growth is tax-free

• Withdrawals for qualified medical expenses? Also tax-free

It’s basically the unicorn of the tax world: rare, majestic, and unexpectedly helpful.

Eligible Expenses You Probably Didn’t Expect

You can pay for a lot of things using your HSA, including:

• Condoms

• Breast cancer screenings

• Glucose monitors

• Reading glasses

• Dental visits

• Allergy meds

• Menstrual cups and pads

• Hemorrhoid cream

The “Last Month Rule” and Other Fine Print

Navigating an HSA has a few essential rules, so it's not all sunshine and tax-free rainbows. One of the trickier provisions is the "last-month rule." This rule is a notable exception that allows you to contribute the full annual HSA amount, even if you only became HSA-eligible on December 1st. 

However, this comes with a strict requirement to remain eligible for the entire following calendar year: If you max out your contributions under the “last-month rule,” you must stay HSA-eligible for the next 12 months.

Additionally, you should consider the following: 

• When you spend your HSA on non-medical expenses before age 65, it’s a 20% penalty plus taxes (so don’t even think about using it on a trip to Disneyland).

• And if you’re enrolled in Medicare, you can’t contribute anymore

An HSA offers a rare triple-tax benefit, acting as a secret weapon for both your healthcare costs and retirement savings. Find out how this underrated account works and why it might be the smartest money move you make all year.

The Queen of Mean Meets Mr. IRS

Most of us have, at some point, looked at a receipt for a new desk chair or a particularly robust pack of pens and thought, "Well, this is sort of for work." It’s a fleeting, gentle flirtation with creative accounting. 

Leona Helmsley, on the other hand, took that idea, fed it steroids, and sent it to Tiffany’s with a blank check. She didn’t just flirt with creative accounting; she tried to marry it, which, as the IRS is fond of pointing out, is bigamy.

From Hotel Royalty to Queen of Mean

Before she became a permanent fixture in the tabloids, Leona was the self-styled “Queen of the Palace.” After marrying real estate mogul Harry Helmsley, she became the glittering, famously demanding face of his hotel empire. 

Her ad campaign featured her in a tiara, promising a standard of luxury so high it probably made actual royalty nervous. The ads worked, but they also helped cement a public persona that was less benevolent monarch and more, well, “Queen of Mean,” a nickname that would stick to her like cheap wallpaper through her trial and, eventually, in her obituary.

Where a Dance Floor Becomes a Business Expense

Her real trouble began at home, specifically, at Dunnellen Hall, her 21-room Connecticut mansion, which was undergoing a renovation of spectacular expense.

Leona’s grand scheme wasn't just to have the family business pay for the renovation. The part that got the federal government’s attention was in taking those personal costs and having the business deduct them as "ordinary and necessary" expenses. 

We’re not talking about a few cans of paint here. We’re talking about a $1 million swimming pool enclosure, a $250,000 jade dance floor, and a $45,000 silver clock shaped like the Helmsley Building. This is the tax equivalent of buying a diamond tiara and claiming it’s a hard hat required for site inspections.

The whole thing unraveled when a disgruntled insider and a stack of falsified invoices found their way to a reporter at the New York Post. Suddenly, the Queen’s lavish home makeover was a federal case.

Leona Helmsley's lavish home makeover led to a spectacular trial and an ironic prison sentence. See how the "Queen of Mean" finally got her comeuppance from the IRS.

The quick (and slightly prickly) stories we didn’t have time to get to:

• After major staffing losses earlier this year, the IRS is now facing a new wave of layoffs targeting its IT and HR departments, raising concerns about the agency's ability to handle the upcoming tax season.

• Roger Ver, an early cryptocurrency advocate known as "Bitcoin Jesus," has agreed to pay the IRS nearly $50 million in back taxes to have a criminal case against him dropped, which alleged he concealed his Bitcoin assets to evade an "exit tax" upon renouncing his U.S. citizenship.

• Americans remain deeply divided on how to tackle the federal deficit, with a new poll showing most favor spending cuts in theory but oppose touching major entitlement programs, while tax hikes on the wealthy are popular with everyone but Republicans.

• The IRS continues to promote its "Where's My Refund?" tool and IRS2Go mobile app as the fastest way for taxpayers to check the status of their refund without having to call and speak to a human.

Think you're a tax whiz? Prove it with our trivia question below.