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What the IRS Keeps Secret | Statute of Limitations

Updated: Oct 13


Coast to Coast - IRS Help

IRS Tax Relief - Statute of Limitations

Many taxpayers believe that the Statute of Limitations, or the amount of time the IRS has to examine a tax return, is three years. This is generally true for assessment of the tax, i.e., the amount of time that IRS has from the filing date of the tax return to look back and make adjustments to a particular tax return.

For a taxpayer that has a past due balance, the IRS has ten years from the date of assessment to collect the tax. If your tax return is filed on April 15, 2021 and any balance due is not paid, the IRS has until April 15, 2030 to enforce collection on that past due balance.

Knowing the amount of time remaining on the ten year collection period is important because it helps determine which tax relief solution the taxpayer should take to resolve the past due balance. If the taxpayer has most of the ten years remaining, then the solution may be to file an Offer in Compromise (OIC) or request an Installment Agreement.

An Offer in Compromise (#OfferinCompromise) will settle your tax debt for dramatically less than what is owed. As soon as the OIC is submitted, the IRS will cease their collection efforts.

A payment plan may make the most sense. Be aware that you do not want to pay a larger monthly payment than the IRS is entitled to. Therefor, you should check in with a tax professional before agreeing to any pay plan with the IRS.

It may make sense to try to have the outstanding liability deemed Currently not Collectible (CNC), which may result in the ten year statute to run out without a payment being made. Our team of tax professionals often use the Currently not Collectible option while we prepare the Offer in Compromise settlement.

Understanding your tax relief options when trying to settle tax liability should be taken seriously and retaining professional help is always recommended.

There are times when our IRS Attorneys play a "cat and mouse game" with the IRS in order to use the IRS Code against them and run out the clock on the agency's ability to collect.

Should you or someone you know has an unpaid IRS income tax liability and would like to talk to us about resolving your IRS problem, please feel free to contact the tax pros at Flat Fee Tax Relief. Our consultations are always free.





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