IRS Debt not a lifetime sentence – Statute of Limitations on Collections 16

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Do you owe back taxes? Are you afraid to go to the mailbox for fear of receiving the dreaded tax bill? If you do owe back taxes, and your bill is accruing both penalties and interest, you have IRS Problems. To help alleviate you and your family’s financial and emotional burdens, it is important to seek help from a tax professional.  Click here to read or watch more IRS Help resources.

10 Years

In general, the IRS has 10 years to collect back taxes. This 10 years starts from the day your tax bill is finalized. Your tax bill can be finalized in a number of different ways: If you have a balance due on a tax return; The amount assessed after an audit or a final proposed assessment. Remember that if you did not file a tax return, the IRS will create a substitute return for the taxpayer and the statute of limitations will begin from the date set by the IRS.  Click here to watch or read more information on IRS Back Taxes.

It essential that you are aware of the Collection Statute Expiration Date (CSED). This date is helpful if you are working to resolve your tax debt. If the CSED is soon, it is important not to do anything that would actually extend the statute. The IRS may start aggressive action to get you to pay your tax debt before the CSED. Do not sign anything as it may extend your statute of limitations.

Remember, if the IRS does not get payment in full, including interest and penalties, in 10 years time, the balance remaining disappears as the statute of limitations has expired.

Statute of Limitations Extensions

The statute of limitations can be extended if you chose to resolve your tax debt by filing for bankruptcy or obtaining an Offer in Compromise. Another factor that could affect the date is leaving the U.S. for an extended period of time. It should be noted that if you have been assessed a tax debt because of having been convicted of tax fraud, your tax debt will never expire.

The statute of limitations can also be extended by agreement between the IRS and the taxpayer. This agreement has to be done prior to the expiration of the 10-year period and requires the taxpayer to sign a waiver extending the statute of limitations to the date specified on the waiver.

If you are in need of clarification of any of these issues, are looking for IRS Help or have other IRS Problems you need to discuss, our knowledgeable staff will be glad to assist you. We can help you solve your IRS Problems. Contact our office today.

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