What happens to the tax liability after the IRS lien expires?
Campbell, CA |
I am in an uncollectable status with the IRS but have a lien against me. If my situation doesn't change, as interest and penalties continue to grow, after the lien expires, does the liability drop off too?
If your account remains in Currently Not Collectible status until the statute of limitations (a.k.a., Collection Statute Expiration Date) expires then the government will no longer be able to collect the debt. The CSED is 10 years from the date of assessment, subject to some exceptions.
This response should not be considered legal advice. No attorney-client relationship is formed by this response, which reflects only the opinion of the author. The response should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question and could change if additional facts were made available.
You have the process backwards. While you are in CNC status, the 10 year period for collection continues to run. Once the 10 years passes, the amount is no longer owed, so the lien is removed as the IRS no longer has an interest to protect.
I agree with Attorney Larson. One note: You may have to contact IRS and request a Release of Lien. Otherwise, it may take years to actually see proof of the liability released.
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