IRS Tax Collection Timeframes in Washington DC

When taxpayers owe the Internal Revenue Services (IRS)a significant sum of money, they tend to fear that their debt will never goaway.

Everyone knows that the IRS does not mess around, andthey may go after one’s assets, property, and wages in some circumstances.

Fortunately, there are certain exceptions that maysave taxpayers the stress of enduring the hardships of the collections process,thus eliminating the anxiety-inducing terror of never-ending payments.

Understanding these exceptions regarding IRS taxcollection timeframes in Washington DC can better educate the majority that owea substantial amount of money in back taxes, so they can proceed forwardconfidently.

A seasoned tax resolution attorney could assist those that are uncomfortable with the negotiation processes and require professional guidance and support in their tax-related endeavors.

TheRole of Statute of Limitations on IRS Collections

Many taxpayers are not aware that there is a 10-year statute of limitations on IRS collections. Meaning, the IRS can collect unpaid taxes for a total of ten years from the assessment date. After ten years have passed, the IRS must stop its collection efforts, barring any important exceptions. Every year, taxpayers benefit from the IRS tax collection timeframes in Washington DC.

However, once the Collection Statute Expiration Date(CSED) draws near, the IRS may act aggressively to coerce the individual intopaying as much as possible before the ten-year deadline.

While this should be a proverbial light at the end ofthe tunnel for taxpayers, there are certain circumstances that can affect theCSED such as:

  • The taxpayer has applied for bankruptcy and the debt issued has an automatic stay
  • An Offer in Compromise is rejected
  • Innocent Spouse Relief is requested
  • The taxpayer has lived outside of the United States for at least six months
  • Voluntary extension of the 10-year statute of limitation
  • The IRS sues the taxpayer in federal court

The IRS will also restart the collection process ifpayment arrangements are made. For instance, if the IRS spends eight monthsworking on the arrangement offer, eight months are added to the time frame thatthe IRS has to collect.

TheDetrimental Effects of Voluntary Extension in Washington DC

As stated before, the 10-year limitations period may seem relatively straightforward and absolute, but it is quite the opposite. Extensions may occur if an individual voluntarily agrees to them.

Taxpayers can unknowingly give the IRS more time.Remember, after the 10-year limit, the IRS must stop any collection activityagainst the taxpayer. The individual also retains the right to request writtentranscripts proving that the debt is considered settled by the IRS, thusshowing a zero balance on the statement.

However, if one enters into an installment agreementthat allows for partial payment of the entire total, the taxpayer will likelysign a waiver that prolongs the statute of limitations.

Once the CSED is nearing an end, IRS personnel may offer an installment agreement that comes with attractive terms to entice the taxpayer, therefore extending the collection deadline. This may prove costly, especially with those that believe the IRS granted them respite when in hindsight, they could have refused to extend the deadline and let the IRS collect until the 10-year period is up.

Providinga Safe Tax Haven for Washington DC Residents

Many taxpayers bend to the will of the IRS becausethey believe they do not have any alternatives. However, by taking the IRS taxcollection timeframes in Washington DC into consideration, a taxpayer can makea confident decision without worrying about the IRS loitering about. To learnmore, call today.