How long does the IRS have to collect the money that I owe them?
I get this question every day. Most people believe that they will have to pay on their taxes for the rest of their lives.
When you file a tax return and owe money and don’t pay the balance, the IRS will assess you your tax. They will send you a balance due statement and want to collect. The IRS establishes a collection statue expiration date from the date the tax was assessed. The collections statute expiration date, or CSED, is 10 years and one month long. Although the IRS can re-assess the tax for another 10 years, it is rare that they do. Once the expiration date has passed, the tax “falls off” and you will not owe that tax anymore.
There are a few things that can extend your CSED's. Filing for bankruptcy will extend the expiration date for the time between filing and having your bankruptcy discharged. Making an Offer in Compromise will extend the the CSED also. Any time spent living outside the United states or serving over seas in the military will also extend your CSED's.
To find out where you stand with your CSED’s and to get many more questions answered about the IRS and taxes you owe call a reputable tax resolution firm.