{"id":2901,"date":"2023-06-29T09:11:55","date_gmt":"2023-06-29T09:11:55","guid":{"rendered":"https:\/\/mysourcefunding.com\/tax-preparation\/yes-the-irs-can-sue-to-collect-on-a-debt\/"},"modified":"2023-06-29T09:11:56","modified_gmt":"2023-06-29T09:11:56","slug":"yes-the-irs-can-sue-to-collect-on-a-debt","status":"publish","type":"post","link":"https:\/\/mysourcefunding.com\/?p=2901","title":{"rendered":"Yes, The IRS Can Sue To Collect On A Debt."},"content":{"rendered":"
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It is important for all taxpayers to be at least aware of the power of the IRS, in an effort to incentivize compliance. This is due to the IRS possessing many arrows in its quiver to enforce US taxpayers\u2019 payment of a deficiency. The IRS possesses an assessment <\/em>statute of limitations which is generally three years from the time a tax return is filed to make the assessment. Once the IRS determines the taxpayer\u2019s deficiency, under Section 6502, the IRS possesses a collection <\/em>statute of limitations of 10 years (\u201cCollection Statute\u201d). Therefore, the IRS has three years after the tax return is filed to assess the tax owed and then ten years after the assessment to collect the tax.<\/p>\n

During the 10 years, the IRS has the power to garnish wages, impose a levy on bank accounts and file a lien against real property (e.g. a person\u2019s home). The most common reprieve from a federal tax lien is the expiration of the Collection Statute. Under Section 6322, the federal tax lien arises when the deficiency is assessed and continues until the liability is satisfied or becomes unenforceable when the Collection Statute expires. Typically, under Section 6322, the levy or a court proceeding to collect the back taxes may only occur if the levy or the proceeding starts within 10 years from assessment. <\/strong><\/sup><\/p>\n

Methods The IRS Can Use To Extend A Lien<\/h2>\n

Although a lien typically expires after 10 years from assessment, there are various ways this period is extended:<\/p>\n