In addition, the clock could be stopped temporarily ( known as “tolling the statute of limitations” ) for a variety of reasons:
- Bankruptcy filing
- Offer in Compromise filing
- Appeals filing
- Filing a lawsuit against the IRS
- Being out of the country for at least 6 months
- Signing a waiver to extend the CSED
- Military deferments, and more…
Afterwards, the clock will start up again, but not always immediately. For the bankruptcy case, it will take an additional 6 months after settlement. Of course, when the clock is not running, the CSED is delayed, and thereby extended. When the statute of limitations expires, the IRS may not notify taxpayers. That must be tracked by taxpayers themselves or their tax relief professional. Also, it is their own responsibility to obtain documentation from the IRS that the tax debt no longer exists. Once that is confirmed, a tax relief professional can assist the taxpayer in having the IRS issue an official Certificate of Release of Federal Tax Lien or a Lien Withdrawal. Proof of a lien release or withdrawal is usually needed to present to institutions who determine credit-worthiness. It is a first step taxpayers can take to repair their financial profiles. The “waiting it out” strategy is not recommended for all tax debtors, however. The 10-year period is a long time. Some, for example, may not be able to continue to operate their business with the standard measures enforced by the IRS to collect. Attempting to utilize an imminent CSED as an IRS tax debt strategy should only be considered while under the guidance of a licensed tax relief specialist like Landmark Tax Group.
What other options are there?
There are several. One is to have a tax relief professional negotiate with the IRS a potential reduction in the total tax debt. Another is to have that tax expert establish with the IRS an installment payment plan that is financially feasible and that takes advantage of the CSED. A third is to have the tax relief professional present a hardship case to the IRS. During that process, a tax professional can request that the IRS stop collection procedures ranging from liens on property to garnishment of wages. Being in debt to the IRS does not mean being in continual financial distress. There are proven ways to manage IRS tax debt. However, a common error for those unable or unwilling to pay their taxes is to simply do nothing. Research and experience both show people who consult with a tax relief expert early on have fewer financial, business and personal repercussions. Fortunately, most tax relief professionals like Landmark Tax Group provide confidential consultations prior to full-on representation. During the consultation, a tax debtor and tax professional can together understand the scope of the tax problem, discuss the precise options available, and determine how to best resolve the matter together.
