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Statute of Limitations Analysis

Statute of Limitations Analysis


The IRS generally has 10 years from the date of assessment to collect back taxes, penalties and interest from taxpayers. After the 10 year period has passed, a taxpayer can simply inform the IRS in writing that they no longer have the right to collect this tax liability and they will not owe anything to the IRS. If the statute of limitations applies to their case, the IRS will write off the taxpayer’s liabilities.

This seems like a simple way to avoid paying expired tax liabilities. However, as with all IRS rules, there are certain exceptions to this rule. For example, if the taxpayer has signed a waiver agreeing on a payment extension, filed bankruptcy, filed an offer in compromise or filed a timely collection due process hearing request, their case may not qualify to meet the statute of limitations. With our statute of limitations analysis, our tax experts can give your case a thorough examination and determine whether or not your tax liabilities can be written off as expired.

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Tax Refunds and the Statute of Limitations


Interested in finding out if your tax liabilities are no longer collectible? Contact us today to schedule a free consultation.

Frequently Asked Questions About Statute of Limitations (FAQ) 

What is a Statute of Limitations Appeal?

The Statute of Limitations refers to a limited period of time in which the IRS has to make a tax assessment against you for debt owed. The Appeal is the process to stop or pause the action being filed against you. Most differences can be settled within the appeal  system without going to court. A case may be taken directly to tax court if the taxpayer does not want to appeal within the IRS. 

Reasons for filing an appeal must be within the realm of tax law issues. For example, an appeal of a case cannot be based only on constitutional, conscientious, political, moral, religious, or similar grounds.



If I owe back taxes should I try and wait for “Statute of Limitations” to take effect?

If you are closing to the expiration of the statute of limitations then one strategy may be to just “lay low” until the Statute expires. But if there is an active collection case then this may not be a plausible option.

What is Statute of Limitations Analysis?

Review of the collection statute for each open module period with a balance due to determine the CSED or “Collection Statute Expiration Date.”

If the IRS hasn’t contacted me in 7 years, should I take my chances and try to ride out the next three years?

The first step would be to obtain IRS account transcripts and analyze them to determine your current collection status and also determine if the collection statute has been “tolled”.

Since the IRS is so backed up with closures and all, should I assume that they will never get to my taxes and hope to take advantage of “Statute of Limitations”?

No, do not assume that they will forget about you, it is better to be pro active than to bury your head in the sand.

How do I know if I qualify for Statute of Limitations?

As stated above the first step is analyzing the account transcripts for each open module period to determine the CSED for each period and also if there have been any tolling events that would have extended the statute.

What is the percentage of tax payers that end up qualifying for Statute of Limitations?

To my knowledge those statistics are not made public, …in my practice I would say it is a very small percentage, probably something less than 10% of all taxpayers, it is hard to fly under the radar for 10 years, it basically means you have to work cash jobs or earn a very low income such that you are deemed uncollectible.  Mostly it is people that work cash jobs and don’t report much income that fall into this category.

How often does the law for Statute of Limitations change?

The ten (10) year statute has been around a long time and hasn’t changed.  The law also says certain types of actions will toll the statute such as; filing a collection due process appeal, filing an innocent spouse claim, bankruptcy, filing an offer in compromise, pending installment agreement status.


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Franskoviak Tax Solutions
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by Tanya G. on Franskoviak Tax Solutions
Small Business Owner Southfield, Michigan

Owed: $402,312 Settled: $41,170

“Our tax issues were overwhelming and very stressful. My husband’s business owed back payroll taxes and we have been battling the IRS for several years. We decided to hire the Franskoviak team, based on the recommendation of our CPA. They settled our debt with an Offer in Compromise.
I believe Mike and his team truly care about doing a good and effective job for me as their client. I appreciate their responsiveness, when I call or email I can expect a quick response, this helps minimize my anxiety. For example, I recently received a letter from the IRS; when I went to my email to contact John Foran about it, I was very happy to see that he had already sent me an email explaining the letter.

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