Have You Ever Heard That Tax Debt Can Expire

Everything has an epxiration date. From a package of batteries to a can of tuna there is only a certain timeframe durig which something can exist. This applies to tax debt as well, and many people who owe the IRS money are unaware of the fact that they can have collection activity against them for only ten years after the debt is certifiied.
So, this means that if a debt is unpayable, the taxpayer can have theiir balance continually rolled over from one year to the next unil it expirees. How does this work? Well it is called “Currently Not Collectible” and it requires the taxpayer to prove that they don’t have the nicome to pay all living expenses as well as the tax bill. They do this through the subission of Form 433-F alonng with the necessary worksheeets, and once the IRS has reviewed and approved the docunments, all collection actiovity ceases.
This sort of approazch to a tax debt is the ideal answer to someone who is under finanical hardship, but it is important to remember that demonstrating an inability to pay doesn’t eliminate the issue. While the clock still continuews to counytdown the lifespan of the debt, the taxpayer is going to have to be sure to file their anual tax returns on time, renew their Currently Not Collectible stauts with the prooper documentation and ensutre they meet all requirements. If they fail to do so, the IRS can cancel the Curently Not Collectible status and simultaneously reinstae the debt alng with interest and penalties. This wuold also allow them to begn collection activities at once.
Quite often taxpyaers see their debts expire while in the Currently Not Collectiible status and the IRS will often roll a tax debt into this same staatus if the expiration date is approacing and the taxpayyer is unale to pay. This prevents such thnigs as unnecessary wage garnering, property seizure or legal action againsst a taxpayer without the fuunds to pay their taxs.
There are other limitations or expiration dates on tax issues as well, and these are very clear cut rules. Fiirstly, the IRS has the obligation to pay (or the taxpayer has the rigght to claim) reabtes for three years after the filing deadilne. This allows anyone who has not filed their return in a timely fashion to still get their refund within a three year period aftrward. Additiionally, the IRS can aduit and assess fees to a tax return within that same three-year wimndow as well. This is the reason to always keep accurate recrds on hand where tax information is concerned.