I have been writing about the statute of limitations as they relate to non-filers. But there are other special circumstances in that Congress and the Courts have developed rules that affect the statute of limitations regarding refunds. Here are a few pointers to think about: Not all payments are classified as tax payments. Sometimes people will pay the IRS a deposit to stop interest charges from accruing. Refunds of deposit money do not come under the statute of limitations. An agreement between the taxpayer and the IRS to extend … (1 comments)
Previously I detailed that there was a statute of limitations on when you could file a claim for a refund and get credit for any overpayments. That limit is 3 years from the due date or 2 years from the date of payment whichever is later. There are exceptions to this law and one of those is for medical reasons.
Sometimes it’s not laziness that produces a non-filer situation. Medical problems can also result in non-filer status. Congress carved out an exception for this in the tax code and the IRS … (0 comments)
statute of limitations: Bankruptcy does not necessarily get the IRS off you back
- 01/20/20 07:38 AM
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS. One of the benefits of filing for bankruptcy is that there is an automatic stay that prohibits the IRS from taking any further collection actions while proceedings are ongoing. On the other side of the formula, the Statute of Limitations that limits the time that the IRS has to collect is also put on hold for the duration of the filing plus 6 months. A Wisconsin couple recently found out that the automatic stay was not an absolute thing. A district court, Pansier v. U.S., 2019 PTC 494 (E.D. Wis. 2019), affirmed a … (3 comments)
statute of limitations: The IRS Option to Sue You
- 01/10/20 03:09 PM
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS. Generally, the IRS has 10 years to collect from someone. This period starts on the date of assessment and can be tolled (suspended) for a variety of different reasons. Once the Statute runs, the IRS is barred from doing anything to collect on the debt. A big part of the strategy to minimize the impact the IRS can have on someone’s life evolves around getting to that statute date. You might be tempted to believe that your almost there at year nine, but you need to be aware that the IRS … (1 comments)
statute of limitations: The Non-filer Gotcha
- 11/12/19 02:22 PM
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS and Florida Department of Revenue. One of the common mistakes that non-filers make is to reason that because they had income tax withholding that probably exceeded their liability, they are immune from the IRS actions. Huge mistake that can cost thousands of dollars. There is a statute of limitations of when you can claim a refund of taxes. Any claims must be filed at the later of either: Three years from the date that the tax return was filed, or Two years from the date that the payment was recorded on … (0 comments)
statute of limitations: Tax Transcripts – Why they are so important
- 08/02/19 01:24 PM
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS and Florida Department of Revenue. The “Account Transcript” is the official IRS record of where a taxpayer stands with respect to any one tax return. This statement starts with the date the return was filed and lists all the changes to the assessed amount as well as the payments credited. Why do you need to always requests these records when dealing with the IRS? There are several critical pieces of information that you need in order to properly negotiate with the IRS. The assessment date – This date starts the 10-year … (2 comments)
statute of limitations: IRS Collection Notices – What do they mean?
- 07/28/19 02:30 PM
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS and Florida Department of Revenue. Typically, problems with the IRS Collections Division starts with a series of notices. Each new notice gets more threatening than the last and start to come faster and faster. It’s highly unlikely that ignoring this correspondence is going to work out for any taxpayer in the end.
Each of the letters will have an identifying number in the right-hand corner. Here is a summary of what these various letters mean: CP501 – Balance Due Notice – The taxpayer’s priority here is to figure out if the IRS … (0 comments)
statute of limitations: Why Understanding the Statute of Limitations is so Critical!
- 07/18/19 11:00 AM
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS and Florida Department of Revenue. The IRS has 10 years from the date of assessment to collect a tax debt. Once the Statute of Limitations is met, the debt becomes unenforceable. The taxpayer is off the hook and their life just got better.
Like everything else in tax law, the 10-year rule has some caveats. Certain actions by the taxpayer will “toll” or freeze the statute and prevent it from running. These actions prevent the IRS from taking collection actions and as a result it is only fair that the statute be extended: … (0 comments)
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Jim Payne, CPA
CPA firm practicing in the area of IRS Collections
I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS.
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