IRS Statute Of Limitations

Much like law enforcement, the IRS is in fact subject to a statute of limitations which ensures that defaulted taxes cannot be collected forever. The IRS has 10 years from the date of assessment to collect all taxes, penalties and interest from the taxpayer. Once the 10 year mark has passed, the IRS cannot collect any more on the taxpayer's tax liabilities.

Rules Of Exceptions

As with many IRS rules, the IRS statute of limitations does have exceptions. As an example, if a taxpayer agrees in writing that the IRS can collect their liabilities over a longer period of time, then that agreement must be followed. Alternatively, if the taxpayer files for bankruptcy during the initial 10 year period, the IRS can in fact extend the collection period.

In many cases, much to the chagrin of taxpayers, the IRS will not automatically cease collection actions after the 10 year period is complete. Cases such as these demand that the taxpayer inform the IRS in writing that the rights to collect the original tax liability have expired. If the facts support this action, the IRS simply writes off the liabilities which have expired.

Is your case getting close the IRS statute of limitations? Contact us here for a free consultation to see how we can help you have your liabilities written off.

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