IRS Law Blog

You have patiently waited for your IRS collection statute expiration date to arrive.

But you anxiously wonder:  As the collection comes closer to an end, will the IRS rear its ugly head and become aggressive?

After all, the IRS isn’t just going to sit quietly and let your tax debt simply disappear without a fight.

They are going to want to make a last-minute push to see what they can get, right?

Fortunately, the beast should not awaken and disturb you.

Here’s why your collection end date should pass with barely a whimper from the IRS:

• If you are in an installment agreement, the IRS cannot take any action against you to collect the taxes.  It does not matter how close to the collection statute expiration date you are.  By law, an installment agreement protects from you an IRS levy against your wages, accounts, and property.  When the IRS collection expires, your installment agreement will be over and no longer needed, and your tax debt will be gone.
• Currently not collectible status (hardship) also protects you from any IRS attempts to collect before the end comes.  If the IRS has you in currently not collectible status, they have agreed to leave you alone, and that includes up to the collection statute expiration date.
• If your account has been with the IRS Automated Collection System, understand that everything the IRS will be doing is automated by computer.  As your end date approaches, no humans are involved or making a decision focused on you.  If the IRS computer has been quiet, a pending statute expiration does not robot-like put it into overdrive.
• The IRS likely does not have an eye trained on you or a tickler in their file with a date to start coming after you.   Your account is one of millions the IRS has in its collection inventory.  In that regard, you are a number waiting in line for your collection date to expire.
• IRS routinely allows collection statute dates to expire.  IRS computers do not suddenly come alive every time a tax debt gets close to the end.  They simply are not programmed to monitor and hit every expiring debt.  In most cases, the collection end comes and goes without drama from the IRS.  The end is usually a calm river, not a hurricane.

It is important to understand an IRS computer cannot take your house, car, retirement accounts, or household goods.  These are high-level seizures that require human involvement.  If your account is with an IRS computer (Automated Collection System), this type of action is off the table even with a nearing collection statute expiration date.

And take comfort in knowing that IRS Revenue Officers are generally not assigned files just because the collection statute is about to expire.  There are very few IRS Revenue Officers, especially compared to the amount of taxes the IRS carries.  For example, the IRS has approximately 3,000 Revenue Officers and can carry over 11 million delinquent taxpayer accounts.

The risk that an IRS Revenue Officer will appear at your door, representing an aggressive IRS, just because your debt is about to expire is small.  Quiet IRS files with pending collection expiration dates tend to stay that way.

Also know that Revenue Officer is prevented by law from taking an asset that does not have equity.  In other words, even if the collection statute is about to expire, if there is nothing in it for the IRS, you keep it.  Instead, a Revenue Officer can place you in an installment agreement or currently not collectible status even if protects you and permits the clock to run out.

It may be counter-intuitive, but IRS systems allow tax debts to pass the 10 year mark on a routine basis.  The IRS should not be considered a ticking bomb on a nearing collection statute expiration date.  There are not enough IRS resources to endlessly chase each expiring tax debt.

In preparation, it is important to confirm your collection end date to know your target, and monitor your account status and IRS activity to safely hit it.  When the  collection statute date arrives, follow-up should be made with the IRS for written confirmation your debt has been cleared.   This can be accomplished in a low-key manner without waking the IRS by use of their private attorney information lines, known as the Practitioner Priority Line.

Anxiety over your tax debt coming to an end is understandable, but when properly handled and understood, the end of most tax debts are not nail-biters.