Many taxpayers want to know how long the IRS has to collect a debt, and whether it can lift the collection window. The answer is no, the IRS cannot lift, erase, or override the 10-year deadline arbitrarily.
The IRS has a limited window, typically 10 years from the date of assessment, to collect unpaid taxes. However, certain actions and events, triggered by the taxpayer, can pause or extend the 10-year window, effectively giving the IRS more time to pursue collection.
If your 10-year Statute of Limitations has been extended or suspended, don’t try to handle the IRS on your own. Victory Tax Lawyers focuses exclusively on IRS cases and has over a decade of experience protecting taxpayers. Get a free consultation today to speak with our tax relief attorneys.
In this post, we’ll explain the meaning of the IRS’s 10-year statute of limitations, the reasons it might be paused or extended, and the implications for your tax debt.
What Is the IRS 10-Year Statute of Limitations?
The 10-year statute of limitations on tax collection is the time period the IRS has to legally collect unpaid federal tax debt. This 10-year countdown begins after the IRS assesses tax. From that assessment date, the Internal Revenue Service (IRS) generally has 10 years to take collection actions. At the end of the ten years, the IRS can no longer collect back taxes. Even if the IRS tax debt remains unpaid, you’re no longer legally required to pay it. This deadline is known as the Collection Statute Expiration Date (CSED).
What People Really Mean When They Say the IRS Lifts the 10-Year Statute
When someone says the IRS “lifts” the statute, they usually mean that the IRS has more time to collect a tax debt because the 10-year clock was paused or extended. As we’ve explained, the IRS cannot simply choose to extend (often called ‘lift’) the statute of limitations. The extension that sometimes happens is often triggered by certain events or actions carried out by the taxpayer, like requesting a payment plan, submitting an Offer in Compromise, or filing for bankruptcy.
When the IRS statute is paused, the clock temporarily stops and resumes once the event ends. This gives the IRS more time to collect unpaid taxes. When it’s extended, additional time is added to the original 10-year period. Formal extensions of the statute of limitations were more common in the past. Right now, the IRS uses this option less frequently.
In practice, whether the statute is paused or extended, the result is the same: the IRS can extend its collection activities, including wage garnishments, bank levies, or federal tax liens, depending on how much time was paused or added during the collection period.
Common Reasons the IRS May Pause or Extend the Statute of Limitations
The IRS can pause (or “toll”) the 10-year collection period under several circumstances, including:
- Bankruptcy – When a taxpayer files for bankruptcy or has an open bankruptcy case, the statute of limitations is suspended for the duration of the case and for six months after the bankruptcy concludes.
- Offer in Compromise (OIC) – If you submit an OIC, the collection period is paused while the IRS considers your offer. If the offer is accepted, the statute may remain suspended until the full terms of the settlement are satisfied.
- Installment Agreement Negotiations – The statute is temporarily paused while the IRS and the taxpayer are in the process of negotiating, modifying, or reviewing an installment agreement. However, once finalized, the statute generally resumes.
- Collection Due Process (CDP) Hearing – Requesting a CDP hearing stops IRS enforcement actions and pauses the statute while the hearing is pending. If the matter proceeds to court, the suspension continues through the duration of judicial review.
- Tax Litigation or Appeals – When a case is under review in Tax Court or another legal forum, the collection period may be extended until the matter is resolved. This includes time spent in appeals or related proceedings.
- Living Abroad for Extended Periods – If a taxpayer is outside the United States for six months or more, the statute may be suspended during that time. The pause ensures the IRS retains enough time to pursue collection once the taxpayer returns to the U.S.
- Other Administrative Actions – Certain administrative procedures, such as filing for innocent spouse relief and other forms of tax relief, receiving a taxpayer assistance order, or serving in a designated combat zone, can trigger a suspension of the statute.
How Long Can the IRS Suspend or Extend the Statute?
The length of time the IRS can suspend or extend the statute depends on the reason for the suspension. Under IRS rules, the statute cannot be suspended indefinitely. Each event that pauses the statute comes with clear limits. For example, in cases of bankruptcy, the collection period is suspended for the duration of the bankruptcy and an additional six months afterward.
If you file for an appeal or a Collection Due Process (CDP) hearing, the statute also pauses while the appeal is pending. This is also the case during any subsequent court proceedings. Similarly, submitting an Offer in Compromise will suspend the statute while the IRS reviews the offer. After it has been accepted, the statute will remain suspended through the duration of the payment period.
What Are Your Rights as a Taxpayer When the IRS Lifts the Statute?
It’s important that you know your rights when the IRS pauses or extends the statute of limitations. First, the IRS is required to notify you when it pauses the 10-year collection window. However, not every suspension comes with a direct notice. This is why you shouldn’t be oblivious of your tax status.
If you believe the statute is being wrongly extended, you can challenge the IRS. You can even challenge their actions if you were not properly informed. You can request a Collection Due Process (CDP) hearing or file an appeal through the Tax Court. You also have the right to negotiate a resolution rather than waiting out an extended statute that may drag on for years.
At this time, working with a qualified tax attorney is critical. They will review your IRS records, identify the official Collection Statute Expiration Date (CSED), and determine whether the IRS is acting within its limits. They will make sure your rights are protected during the suspension.
How to Check if the IRS Has Suspended Your Statute of Limitations
There are a few practical ways to find out whether the IRS has suspended or extended the statute of limitations on your IRS tax debt. One of the most reliable methods is to request your IRS account transcript. This document outlines key events such as the original assessment date, any collection activity, and whether there have been pauses in the statute.
Bankruptcy filing, an installment agreement, or a pending offer in compromise are factors that can cause this pause. You can request the transcript directly from the IRS through their “Get Transcript” tool online. You can also file Form 4506-T to request it.
It’s also important to carefully read any IRS notices you’ve received. These often contain specific language indicating that the collection statute has been suspended or extended. For example, you might see references to CDP hearings, pending litigation, or administrative actions that impact the timeline.
These notices may not always use plain language, which is why it is advisable to review them with a tax professional. They will interpret your account history and confirm whether the IRS is still within its legal timeframe to collect. If you’re concerned that the IRS may be taking action outside the statutory period, getting professional help is your best step toward clarity and protection.
What Should Taxpayers Do When the IRS Lifts the Statute of Limitations?
If you receive a notice or suspect the statute has been extended—sometimes referred to as the IRS ‘lifting’ it, it’s critical to take prompt, informed action to protect your rights. Here are some steps to take:
1. Review IRS Notices Carefully
Carefully read your tax return and every notice you receive from the IRS. These documents often explain why your statute of limitations was extended or suspended. Understanding the IRS’s reason is the first step in deciding your next course of action.
2. Request Your IRS Account Transcript
Your IRS account transcript shows key dates like the tax assessment date and any events that may have extended the Collection Statute Expiration Date (CSED). You need to verify if the IRS is acting within its legal time limits.
3. Consult a Tax Attorney
Before taking any further action, consult with a licensed tax attorney. A professional can help you interpret your transcript, identify any potential IRS errors, and recommend the best course of action based on your unique situation.
4. Respond Promptly to IRS Communications
Never ignore IRS letters or let deadlines pass. Respond quickly to get the chance to fix problems early. IRS letters typically include specific deadlines to respond, request a hearing, or submit additional documentation. Failing to act within these timeframes may limit your legal options and reduce your ability to challenge the IRS’s actions.
If you’re unsure how to respond to any notice or whether a response is even necessary, seeking advice from a tax lawyer can guide you to do what is required on time.
5. Explore Tax Relief Options
If you are facing tax-related issues, explore your options. There are options like an offer in compromise, a payment plan, or other relief programs. A tax attorney can help you choose the option that provides the most benefit to you, given your situation.
6. Appeal or Challenge if Necessary
If you believe the statute was extended in error or disagree with the IRS’s actions, you may have the right to appeal. You can also request a Collection Due Process (CDP) hearing to formally challenge collection activity.
7. Keep Detailed Records
Documentation is important when dealing with the IRS. Save all important records like IRS correspondence, payment receipts, transcripts, and settlement agreements. That way, you can easily defend your case, correct IRS mistakes, and avoid future disputes.
Possible Solutions for Taxpayers Facing an Extended Statute of Limitations
If you’ve just found out the IRS has extended the time they can collect your tax debt, don’t panic. There are still several ways to take control of the situation:
1. Offer in Compromise (OIC):
An Offer in Compromise allows you to settle your IRS tax debt for less than what you owe. It is typically granted when the IRS determines that you are unable to pay the full balance through income or asset liquidation. While it’s one of the most popular IRS tax debt forgiveness options available to taxpayers facing severe financial hardship, it can be difficult to get approved, especially without expert guidance.
2. Installment Agreement
Another option is entering into an installment agreement, otherwise known as a payment plan. This arrangement lets you break your back taxes into monthly payments that fit your budget rather than paying them all at once. It’s often the most straightforward solution for taxpayers owing less than $50,000 and can afford smaller payments, but need relief from the pressure of paying at once.
You can apply for a payment plan online via the IRS Online Payment Agreement tool or by submitting Form 9465. When you apply for an installment agreement, the IRS is generally prohibited from enforcing collection actions on you until it reaches a final decision. If your request is rejected, the collection period remains paused for 30 more days and is afterward resumed.
3. Currently Not Collectible Status
If you’re in severe financial hardship, the IRS may classify your account as Currently Not Collectible, which temporarily halts all collection efforts. Note that when you’re granted CNC status, your debt is not erased, nor are your penalty or interest payments affected. In fact, they’ll continue to accrue until your back taxes are cleared. What you’re provided is breathing room, so you don’t have to face the pressure of dealing with back taxes, accruing interest and penalties, and aggressive IRS collection actions all at the same time.
4. Appeals and Collection Due Process (CDP) Hearings
If you believe the IRS made a mistake or overstepped, you have the right to push back through a formal appeal or hearing. Filing an appeal or requesting a Collection Due Process (CDP) hearing allows you to dispute the IRS’s decision before it takes further action.
These appeals can pause the collection statute while your case is reviewed and, if successful, may help you avoid unnecessary penalties or enforcement. To apply for a CDP hearing, you have to submit Form 12153 within 30 days of receiving a Notice of Intent to Levy.
5. Bankruptcy
Bankruptcy isn’t a magic fix, but depending on your situation, it might pause the collection statute and, in limited cases, even eliminate older tax debts.
However, not all tax debts are dischargeable. There are strict rules that apply before bankruptcy can be used as a basis to clear tax debts. And even then, claiming bankruptcy isn’t always the best route, as it could have serious long-term credit and financial implications; therefore, it’s typically considered only after other options have been explored.
6. Penalty Abatement Requests
Penalties accumulated for not paying taxes can become significantly larger than the original bill. If you’re a first-time offender and can prove you’ve always filed on time, you can request First-Time Penalty Abatement. You may also be able to request Reasonable Cause relief if you can prove that you had a valid reason, such as serious illness, natural disasters, or other events beyond your control that contributed to your being unable to pay your tax bill.
Need a Skilled Tax Lawyer for IRS Statute Issues?
The IRS’s 10-year statute of limitations is meant to set a clear deadline for collecting tax debts. But if the IRS extends or suspends that period, your tax problems can drag on much longer than you anticipated. If you’re nearing the end of the collection period, any misstep can be costly. This is exactly when having a professional in your corner matters most.
At Victory Tax Lawyers, we focus exclusively on tax law and have over a decade of experience defending clients against IRS collection efforts. Our attorneys can help you push back on unfair extensions, explore your eligibility for debt relief, and protect your finances. If you’re unsure whether the IRS has lifted the 10-year statute of limitations on your tax debt, our lawyers can help. Visit us today or schedule a free consultation to speak with the team.
Frequently Asked Questions
Here are some of the most common questions taxpayers have when dealing with IRS collection time limits:
Can the IRS Collect Taxes After 10 Years?
Yes. The IRS can still collect after 10 years if the statute was suspended or extended.
What Does It Mean When the IRS ”Lifts” 10-Year Statute of Limitations?
The IRS can not actually lift the 10-year statute of limitations, but it can legally extend or suspend the time it has to collect a tax debt beyond the standard 10-year limit.
Are There Any Exemptions or Limitations to the IRS’s Decision?
Yes. Some actions, like bankruptcy, an offer in compromise, or requesting a Collection Due Process hearing, automatically pause the clock. There are rules and limits to how long it can be extended, though.
How Do I Know if My Statute of Limitations Has Been Suspended or Extended?
You can request your IRS account transcript. You will find key dates like the assessment date and any suspensions on it. IRS notices will also indicate if the statute has been lifted or extended. If it’s unclear, a tax attorney can help you interpret the information.
Can I Negotiate With the IRS if the Statute Is Suspended?
Yes, you can, and you should. The IRS forgives tax debt through options like offers in compromise or requesting currently not collectible status. A tax lawyer can help you choose the best strategy.
What Happens if the Limitation Expires While the IRS Is Suspended?
If the statute expires during a valid suspension period, you’re not necessarily off the hook. The IRS may still collect once the suspension ends.
Does Bankruptcy Always Suspend the Statute of Limitations?
Generally speaking, yes. When you file for bankruptcy, the IRS can’t pursue collection efforts. The statute is paused for the duration of the case. You also get an additional time of at least six months afterward!
