This is a question we are often asked. Tax planning on your case becomes a key issue and knowing how long the lien is good for is critical.
How long is a Federal Tax Lien good for?
A Federal Tax Lien continues until the liability for the amount that is assessed against you is satisfied in full. The Federal Tax Lien could also become unenforceable because of a lapse in time. The collection period expires ten years from the original date of the assessment
Can the ten year period of time be extended by law?
Yes it can.
- How long is a Federal Tax Lien good for?
The statute of limitations was extended at the same time an installment agreement was entered into. In this case, collection action may be taken until the 89th day after expiration of the installment agreement. IRC § 6502(a)(2)(A). You want to make sure IRS does not extend the statue of limitations on your case - Or if a release of a levy under IRC § 6343 is accompanied by an agreement to extend the statute of limitations to a specific date and that date has not yet passed. IRC § 6502(a)(2)(B); Treas. Reg. § 301.6343-1(b)(2)(ii)(D).
Other reasons that exist common to these cases is that the taxpayer has been outside the United States for a continuum of 6 months or a bankruptcy has been filed. These also extends the statue of limitations. There are a few other reason though rare.
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One Comment
The above answer included “The collection period expires ten years from the original date of the assessment.” I thought it was from the date the lien was filed. Can anyone clarify this? THANKS!