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Elizabeth Prentice
Elizabeth Prentice, Attorney
Category: Business Law
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Experience:  Legal counsel for multitude of businesses; Business Law Professor; Experience as In-House Counsel
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I need a tax attorney or an accountant. regarding the IRS---when

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I need a tax attorney or an accountant. regarding the IRS---when a 10 yr statute runs out-meaning the full 10 yrs has been 'used.'----does the IRS any additional time at the end of that before they close it?
Submitted: 11 months ago.
Category: Business Law
Expert:  Elizabeth Prentice replied 11 months ago.
I am an attorney and I would be happy to assist you. The Internal Revenue Code section 6502 provides that the length of the period for collection after an IRS assessment of a tax liability is 10 years. The assessment date is not the same as when you filed your tax return. You will need a collections statement which will show the actual assessment date. The collection statute expiration (10 years from the date of the assessment) ends the government's right to pursue collection of a liability.

However, the IRS is entitled to request a waiver of the above statute before the time runs out to extend the 10 years if it was made with the debtor's agreement to an installment plan (payment plan) or if there exists a levy or lien. So if the IRS filed a recorded debt in the county in which you reside, then the period of collection is extended. For example) the IRS filed a document with the county recorder's office in your state regarding your debt, then that lien still exists and therefore in order to resolve the levy at some time in the future (such as remove it or receive funds from your property) the 10 years will not apply. For example) the recorded document states that you owe $10,000 to the IRS. If you own a house, that recorded document has secured a claim on your property. So if you sell your house the IRS may still be able to take $10,000 of profit from your sale before you would receive anything. A lien can attach to your car, home and other personal property. If you find a lien filed against you and if the Statute of Limitations has run, you may be eligible to file a request to the IRS to release their lien.
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Understanding-a-Federal-Tax-Lien

I hope my answer has assisted you and that you will leave me a positive rating!

Customer: replied 11 months ago.

W/o considering the waiver----just the 10 yr statute. Once the 10 yrs from the assessment date has passed --to the exact day---does the statute 100% officially pass / done / over--remember we are not talking about a waiver----or is there any other 'administrative' time added on before it is officially closed. In the past I had been told by an attorney that there was either an additional 30 or 60 days---I just do not remember what they told me.


 


When you say they can 'request' a waiver----who are they requesting it form / to?remember what that was.


That is the gist of my question.


 


BTW-you would think that the IRS would have the responsibility to give you this info-----forget it---I was hung up on twice as they claimed they had no idea what I was talking about. Tried FOIA to---strangely omitted.


How else would I know I was free & clear?


Is there a tel # / specific dept of the IRS I can go to for this info?


 


Also---are you saying that if the statute runs out and the IRS had not gotten a waiver and their had been a lien on my property that the lien would 'survive?' It would continue to be in place? That would be strange sine the debt was no longer collectable.


 


 

Expert:  Elizabeth Prentice replied 11 months ago.
I am sorry to hear you had so much trouble attempting to get information. Essentially when the Collection Statute Expiration Date or CSED (10 year point)passes, the IRS is barred from attempting to collect your tax debt unless you waive the enforcement of the statute. There are only a few circumstances other than a waiver that would extend the time, such as if you had filed bankruptcy, were out of the country, or a waiver. Attorneys usually tell their clients that it extends 30 or 60 days, to be on the safe side in case they fell within an exception in the last 10 years the client forgot about. The IRS may actually give you a CSED statement, stating the date it was closed.

To answer your question about waivers, they would be requesting it from themselves actually and usually the debtor is required to sign off. If you haven't received notice of a waiver, then you probably shouldn't be concerned about this issue.

The IRS is unable to provide legal advice on their statutes; so there is not a phone number to ask them on how to interpret their legal Internal Revenue Code. I do recommend actually going into your local IRS office if you have questions, instead of calling. Many of my clients are usually surprised that you can actually go in to meet with someone about your file. I always recommend going early and bringing a book, in case you have to wait awhile.

With regards XXXXX XXXXX questions about the liens and levies, yes they do survive. The main issues here is that the IRS can not attempt to collect the tax debt after 10 years. It doe NOT mean you no longer owe the debt to the IRS. So if they filed a lien in your county a few years ago, it has already attached to any property (a car or house, etc.) that you own. So by leaving it on your property they are not in violation on the 10 year rule. This is why many people with old tax debt consider filing bankruptcy. Additionally, you can fill out the forms I previously mentioned above to request the lien be removed from the recorder's office.

I hope my answer has assisted you and that you will leave me a positive rating. IRS Circular 230 Notice: To the extent that this communication concerns federal tax issues, this communication is not intended to be used and cannot be used by any taxpayer to avoid penalties.

Customer: replied 11 months ago.

I am not requesting legal advice from the IRS----I am just looking for where the buck stops in getting the CSED.


 


Isn't having a lien an attempt to collect a debt? The purpose is to seize any equity in the property after the 1st lien holder---the bank gets paid.


 


Bankruptcy wipes put tax debt?


 


I am sorry-but what are the forms I can fill out to request that the lien be removed? Who am I submitting that to---the IRS? If so---what is their motive in removing it?

Expert:  Elizabeth Prentice replied 11 months ago.
The lien was an attempt to collect a debt that occurred prior to the CSED. It already would have attached to your property prior to the CSED, therefore it is not "attempting to collect a debt" after the fact. They can not amend it though to add interest and penalties as they would typically year after year. Typically, the 1st lien holder receives funds after the sale of an asset with a secured recorded lien; however, if the IRS has a recorded lien it is called secured, priority. Which means the bank will have to discuss payouts with the IRS.

Bankruptcy can discharge certain tax debts. If you are interested in learning more about which tax debts bankruptcy can discharge, please feel free to post a question in our bankruptcy forum and a Just Answer bankruptcy expert will be happy to assist you!

Forms to remove a lien or levy are found at the link I posted in my original answer to your question.

Thank you for using JustAnswer! Please make sure to leave me a positive rating so that I can be paid for my time in assisting you. Additionally, if you have any further questions, please feel free to post new questions and ask for me by name. Good luck with your legal matter. IRS Circular 230 Notice: To the extent that this communication concerns federal tax issues, this communication is not intended to be used and cannot be used by any taxpayer to avoid penalties.
Customer: replied 11 months ago.

Ok----lastly as I don't want to drag this out any longer---


 


Re: the lien---it has to be an attempt to colllect a debt. By having it still attached to the property effectively by nature / definition they are saying we want to get paid. We are still wanting to collect the debt. If they weren't still trying they would not be there.


 


To say they are not does not make sense.


 


Very lastly----the forms to remove the lien---those are sent to the IRS? Why would they want to remove it?


 


Thanks for your answers---if I have any other questions I will pursue them with another submitted question.


 


 

Expert:  Elizabeth Prentice replied 11 months ago.
Recorded liens are a complicated subject. As I stated previously, it is recorded against you as a person. It was an attempt to collect a debt in the past. They do not have to remove it unless they a) get paid or b) you request they remove it from you. First, you should find out if there any liens in existence. If there are it is always wise that you request they remove it because a) you have no property from which they may collect it and b) the time has expired for them to further collect. This is where state law and federal law intertwine. As long as the recording was perfected prior to the statute the lien already attached long ago to any property you had. So example) if you inherited a house today, the expired lien should not attach to the house if the CSED already expired. But if you owned the house when they filed the lien and it was years before he CSED expired, then they in a sense already "own" a piece of the property. The aren't "Attempting to collect a debt" if they receive a piece of the equity. In a way, theoretically, they let you live in their equity. It is a complicated concept for most people to understand, so it is ok that you are having a difficult time. Lastly, you can also file bankruptcy and send them the lien form requesting they withdraw the lien cause it has been discharged. That is the most typical way to have a lien removed, unless you paid it off.

Thank you for using JustAnswer! Please make sure to leave me a positive rating so that I can be paid for my time in assisting you. Additionally, if you have any further questions, please feel free to post new questions and ask for me by name. Good luck with your legal matter. IRS Circular 230 Notice: To the extent that this communication concerns federal tax issues, this communication is not intended to be used and cannot be used by any taxpayer to avoid penalties.
Customer: replied 11 months ago.

I did ask what would be their motivation to remove it.


You said 'they do not have to remove it unless a. they get paid or b.- you request they remove it from you.' Are you saying they have to remove it is I ask them to?


 


To be honest with you your response about the owning a piece of the equity is quite convoluted. There is no doubt that they are attempting to collect the debt---so therefore they took an action---an attempt that was only related to a debt---there was no other reason to take that action-but to collect the debt.


So when the statute expires that action / attempt should become null and void.

Expert:  Elizabeth Prentice replied 11 months ago.
Unfortunately, the law is a gray area and every situation is different depending on the recordation, whether it is a levy or lien, dates, the type and value of property it was recorded upon, county perfection rules, etc. If you request they remove the lien, you need to assert a reason for the request. They are not required to remove it based merely upon a request. If you are concerned that there exists a recorded lien against you, I recommend consulting with an attorney in your county that can analyze the document more closely and fill out any paperwork that requires further substantive legal analysis. As you read the request to remove a lien, it provides an area where you can state your reason to the IRS for the removal of the recordation from the County Recorder's office. If you have a statement from the IRS stating that the 10 year time limit has run, you use that as your claim and attach a copy to the paperwork before sending it to the IRS. They assess each case independently and have the right to deny removal of the recordation. It is best to hire an attorney in your area to assist you.

Thank you for using JustAnswer! Please make sure to leave me a positive rating so that I can be paid for my time in assisting you. Additionally, if you have any further questions, please feel free to post new questions and ask for me by name. Good luck with your legal matter. IRS Circular 230 Notice: To the extent that this communication concerns federal tax issues, this communication is not intended to be used and cannot be used by any taxpayer to avoid penalties.


Elizabeth Prentice, Attorney
Category: Business Law
Satisfied Customers: 170
Experience: Legal counsel for multitude of businesses; Business Law Professor; Experience as In-House Counsel
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