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
Debts remain until paid.
New Mexico
10 years after date of assessment
New York
20 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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Great post everything on csed dates compiled in one spot
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i have a levy from a tax that was never assessed when i was homeless, unemployed and living in my pickup truck, a lien from a payment agreement that is over16 years old and i defaulted when i was unemployed, homeless and living in my pickup truck and a lien for income i never received while i was homeless, unemployed and living in my pickup truck.
how do i deal with that
On this you would need to contact the IRS (or state if a state authority) and find out exactly what the tax debt is due to and how much it is. From there you can see if it is going to expire soon or if something else should be done to resolve it.
The defaulting of the payment agreement won’t stop the IRS’ 10 year period to collect, so those debts might be close to expired by now. If you would like for us to look into this for you, you can reach me at (888) 515-4829, and press 77.
See other comment or call us we can fix it for you
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so a bankruptcy extends tax debts from expiring that were not in the bankruptcy?
Yes exactly. If your only major debt is taxes, you probably should be doing an Offer in Compromise instead if you qualify for a bankruptcy. If you have tons of other debt, Bankruptcy might be the best option. More recent debts will not get reduced on in the bankruptcy. See our Offer in Compromise or Bankruptcy post for more information.
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