IRS 10 Year Statute of Limitations on Collection
What is it?
If you’ve received a tax assessment from the IRS, you should be aware that they have 10 years to collect the money they say that you owe. This is called the Collection Statute, and 10 years is a long time. If you think you’ll escape notice until after the assessment expires, think again. The IRS will likely serve you with a tax Lien or Levy long before the 10 years expires.
The beginning, middle, and end.
The start date of the Collection Statute is the day the tax assessment is made. Defining this date can be tricky, because it shifts depending on what kind of return you are filing; for instance an audited return vs. a regular tax return.
Also, the Collection Statute can be extended for a variety of reasons, such as: bankruptcy, an Offer in Compromise, a request for relief, signing a waiver, or because the taxpayer is out of IRS jurisdiction.
The date that the collection statute expires is called the Collection Statute Expiration Date, or CSED.
These dates are famously difficult to establish concretely, and getting them right is crucial to your payment of back taxes. It may require that you get actively involved – for instance, the IRS may not calculate the CSED correctly, and you may have to engage with them to define and defend your interpretation of the ‘correct’ date. The help of a qualified tax attorney could in these cases is very valuable.
For help with these and other tax issues, visit: www.millertaxlaw.com a Litchfield County, Connecticut tax attorney, admitted to practice in CT, NY, and before the US Tax Court. We accept state tax problems for CT, MA and NY, and we accept U.S. federal tax problems from any location in the world.