Can the IRS collect after 10 years? 2 Answers as of September 07, 2010

I do not believe there is any time limit for collection from the IRS if returns were never filed for those years. The IRS also has 3 years to audit your tax returns or to assess any additional tax liabilities and 10 years to collect outstanding balances. But this does not mean that you can simply avoid them for 10 years. The best answer is to address these issues now, so that you can avoid further interest and penalties. You may contact our office to schedule an appointment if you have further questions or if you need assistance with this issue.

The Collection Statute Expiration Date (CSED) for IRS taxes is, in most cases, 10 years. Once this Statute period has run, any remaining tax debt is forgiven. The statutory period begins on the date the tax debt is assessed which is usually shortly after a taxpayers returns are filed. If a taxpayer never filed their returns the Collection Statute would begin on the date that the IRS creates a substitute return (SFR) for the taxpayer.

In some cases a taxpayers debt may not expire exactly 10 years from the date of IRS assessment. There are a number of ways that the IRS Collection Statute can be extended. For example, filing a Bankruptcy or Offer in Compromise will usually extend the amount of time the IRS has to collect a tax debt. Leaving the United States for a period of time or other factors can also extend this Statute of Limitations as well. A tax debt which is assessed as a result of a citizen being convicted of tax fraud will never expire.

When working to resolve an IRS tax debt, the age of the debt and CSED date are very important factors to consider when coming up with a plan of action. If the debt is close to expiring, it is very important that both the taxpayer and any tax professional they are working with are careful not to take any action which will extend the IRS statute further into the future.