Time's Ticking Away...
It's true, the IRS has a limited amount of time to collect on your back taxes (if you think 10 years is a limited amount of time, that is). The time period the IRS has to collect on the debt you how is called the "Statute of Limitations". If you don't pay your back taxes off in full before the end of the Statute your tax debt will be dismissed
and you won't owe the IRS any additional fees.The Waiting Game...
Don't think you can put off paying your debt for 10 years. Sure, the statutes may expire in 10 years, but the IRS will use every collection method possible to collect from you. It's gonna be a long 10 years!Then there are IRS Statute Exceptions...
The 10 year Statute of Limitations isn't exactly set in stone. Three factors could extend the amount of time
the IRS has to collect on your tax debt.
Bankruptcy: It takes a while for bankruptcy to be discharged. The IRS can't issue collection actions during this time, but this comes at a great cost. The amount of time you were in the bankruptcy extends to time of the IRS Statute. For example if it took you two years for your bankruptcy to get discharged, then 2 years gets added on to the Statute of Limitations.
Offer in Compromise: An Offer in Compromise, or tax debt settlement, can take a year or more to reach a resolution. Much like a bankruptcy, the length of time it takes for the Offer to be approved or denied increases the length of the Statute. Get time on your side... Yes,
you can "wait out" your tax debt. But do you want to? 10 or more years are a long time to live with a debt, and it will feel like a lifetime with the IRS constantly threatening you. Just bite the bullet, and take care of your tax debt now.
Don't let it drag on for a decade!