Today TaxMama hears from James in Arizona with a quick question. “Is there a statute of limitations on collecting back taxes?”
Dear James,
There are several limits – or no limits, depending on how you look at it.
In general, the federal limit (IRS) is 10 years after the tax has been assessed.
But that 10 years can be expanded, if you’ve filed for an offer in compromise, Tax Court petition, bankruptcy… It can start over if you’ve filed an amended return, or if IRS has reassessed the balance due via a correction letter or audit.
It can also be extended if you sign an agreement to give IRS more time to collect. Believe it or not there are times when that is wise.
And there is no statute of limitations if you’ve never filed the tax return at all.
Then there are state limits. Each state has their own rules. In some cases, the statute of limitations can be 30 years – practically an entire adult lifetime for some folks.
What can you do to find out the statute of limitations on your balance due? Easy, call your taxing authority and ask them. They will tell you.
I’ll bet this a lot more than you wanted to know!
And remember, you can find answers to all kinds of questions about tax debt and other tax issues, free. Where? Where else? At TaxMama.com
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