Expiring Tax Debts: IRS CSED and State Tax Collection Expiration Dates 15   Recently updated !


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They only have so long to collect…. thanks to CSED

CSED stands for collection statute expiration date. This is the official IRS term, but state tax debts also have a CSED that can go by other names. Here we will go through the IRS CSED and that of all the states.

Internal Revenue Service

The IRS has 10 years to collect on a tax debt from the date it is assessed. This can be extended by the following:

  • Offer In Compromise is pending
  • Taxpayer is out of the country for more than 6 months
  • A request to place a case into a payment plan or Currently Non Collectable status is pending
  • Bankruptcy proceedings extend the case for the time the bankruptcy is pending

If the case is in a payment plan, Currently Non Collectable status, or just sitting while the IRS is trying to collect, the debt is getting closer to expiration every day. Some tax relief companies might try to get you to file an Offer In Compromise when you have tax debts that are close to expiring since they want to charge you. If your debt is closed to expiring and already in Currently Non Collectable Status or an IRS payment plan, you might just want to let it expire.

Downside to IRS Expiration of Debt

If you settle your debt through an Offer In Compromise, you can file for an IRS lien withdrawal. Same with a payment plan. If the debt is erased by way of expiring, the IRS will typically not withdraw the lien, but show it as released.

IRS Lien Withdrawal vs. IRS Lien Release

What is the difference between a lien withdrawal and a lien release? The withdrawal takes the debt off the record entirely as if it never existed. The release shows it as satisfied, but still shows that at one point you owed the debt. A withdrawal is better for your credit.

It many cases if the debt is close to expiring you are better off letting it expire than filing an Offer In Compromise. Its up to you to decide and we give our clients both options. Some clients prefer still to submit an Offer In Compromise as they want to get that better credit.

State Tax Debt Collection Statute Expiration Dates

Here we will go state by state.

Alabama

10 years after the final assessment of the tax, or prior to the expiration of an agreement made in writing.

Alaska

No personal income tax

Arizona

6 years after amount due becomes final

Arkansas

6 years after amount due becomes final

California

20 years after date of assessment

Colorado

11 years after date of assessment. Colorado follows the IRS CSED guidelines and adds one year to it.

Connecticut

10 years after date of assessment

Delaware

10 years after date of assessment

District of Colombia (Washington D.C.)

10 years after date of assessment

Florida

No personal income tax

Georgia

10 years after date of assessment

Hawaii

10 years after date of assessment

Idaho

10 years after date of assessment

Illinois

10 years after date of assessment

Indiana

10 years after date of assessment

Iowa

10 years after date of assessment

Kansas

10 years after date of assessment

Kentucky

10 years after date of assessment

Louisiana

10 years after date of assessment

Maine

10 years after date of assessment

Maryland

10 years after date of assessment

Massachusetts

6 years from the date the taxes were assessed or the date they were due. whichever is later. If an assessment is related to fraud there is no statute of limitations and debt remains until paid.

Michigan

10 years after date of assessment

Minnesota

10 years after date of assessment

Mississippi

10 years after date of assessment

Missouri

10 years after date of assessment

Montana

10 years after date of assessment

Nebraska

10 years after date of assessment

Nevada

No personal income tax.

New Hampshire

10 years after date of assessment

New Jersey

10 years after date of assessment

New Mexico

10 years after date of assessment

New York

10 years after date of assessment. If assessment is related to fraud, no statute of limitations and debt remains until paid.

North Carolina

10 years after date of assessment

North Dakota

10 years after date of assessment

Ohio

7 years after date of assessment

Oklahoma

10 years after date of assessment

Oregon

10 years after date of assessment

Pennsylvania

10 years after date of assessment

Rhode Island

10 years after date of assessment

South Carolina

10 years after date of assessment

South Dakota

No personal income tax

Tennessee

10 years after date of assessment

Texas

No personal income tax

Utah

10 years after date of assessment

Vermont

10 years after date of assessment

Virginia

20 years after date of assessment

Washington

No personal income tax

West Virginia

10 years after date of assessment

Wisconsin

No statute of limitations, debt remains until paid.

Wyoming

No personal income tax.

 

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