Statutes provide a framework for IRS collection efforts. These include:

The Policy analyst shown on the Product Catalog page as the originator is the assigned author of this IRM.

This IRM is the primary source of guidance on this program. The following list provides additional sources of guidance. Together, this material forms the operating rules and responsibilities for this program.:

Taxpayer Bill of Rights (TBOR) lists rights that already existed in the tax code, putting them in simple language and grouping them into 10 fundamental rights. Employees are responsible for being familiar with and acting in accord with taxpayer rights. See IRC 7803(a)(3), Execution of Duties in Accord with Taxpayer Rights. For additional information about the TBOR, see https://www.irs.gov/taxpayer-bill-of-rights.

You should be alert to problems and scenarios that could impact the statute(s) for each of your cases and to take action, whenever possible, to prevent the lapse of the 24 month TIPRA statute..

Within 30 calendar days from receipt of any Appeals case (except CAP & TFRP cases), you will review the file to determine that all statute dates are correctly shown on the Appeals Centralized Database System (ACDS).

Within 45 calendar days of a newly assigned and/or transferred TFRP case, you will complete the statute verification.

You must make an entry in the Case Activity Record (CAR) to indicate that you verified the statute date. You should also explain any unusual circumstances pertaining to the statute of limitations in the CAR. For specific documentation requirements see IRM 8.22.5.3.2 , Documentation Requirements - CDP Statute Controls and Verifications when working CDP cases, IRM 8.25.2.3 , TFRP Initial Statute Verification Requirements when working TFRP cases and IRM 8.23.2.4 , Initial Case Review and Statute Controls when working non-CDP OIC cases.

You should always be aware of the statutes on cases in your possession and continue to monitor the statute as long as the case is in your possession.

IRC 6502 provides that the length of the period for collection after assessment of a tax liability is 10 years. Each tax assessment has a Collection Statute Expiration Date (CSED).

Any tax assessed on or after November 6, 1990, is collectible for 10 years from the date of assessment. Previously, the collection statute ran for a 6 year period. Any tax assessed on or before November 5, 1990, on which the former 6 year statute of limitations had not expired on November 6, 1990, is collectible for 10 years from the date of assessment.

Once a tax liability is assessed, the statute of limitations for collection begins to run. The expiration of the collection statute ends the Government’s right to pursue collection of a liability.

Effective January 1, 2000, the Service and the taxpayer cannot agree to extend the period of limitations on collection except in conjunction with installment agreements and releases of levy. Extensions of the period of limitations on collection in effect on December 31, 1999 not in conjunction with an installment agreement, expired no later than December 31, 2002.

The IRS will only extend the period of limitations on collection in conjunction with Partial Payment Installment Agreements (PPIA) in limited situations. See IRM 5.14.2, Installment Agreements - Partial Payment Installment Agreements and the Collection Statute Expiration Date (CSED), for limitations and examples of appropriate situations to extend the period of limitations on collection.

Generally, when a taxpayer files bankruptcy, the CSED is suspended by the length of time the Service is prohibited from collecting by the bankruptcy automatic stay, plus 6 months.

A TC 520 is input, with the appropriate closing code, using the date the bankruptcy is filed.

A TC 521 is input as of the date the case is discharged or dismissed from bankruptcy. The CSED is suspended for this period of time plus 6 months in most cases. See IRM 5.9.5.6.1 , Closing Codes and IRM 5.9.5.6.2 , Reversing the Bankruptcy Indicator.

Per IRC 6502(a), a court action to collect tax liabilities brought against the taxpayer prior to the expiration of the collection statute extends the period to collect until the tax liability or judgment against the taxpayer is satisfied or becomes unenforceable. For example, filing of a suit to reduce the tax liability to judgment will suspend the collection statute during litigation. For more information, see IRM 5.17.4.7, Suit to Reduce Assessments to Judgement

The CSED is also suspended with respect to any penalty under IRC 6672, IRC 6694, IRC 6700 or IRC 6701 for the period during which the Agency is prohibited from collecting by levy or a proceeding in court. If within 30 days of the notice and demand, the taxpayer pays the amount specified in section 6672(c), 6694(c) or 6703 and files a refund claim, levy and a court proceeding is prohibited and continues until the taxpayer fails to bring a refund suit within the prescribed time period or the district court decision in the refund suit becomes final.

The CSED is suspended during a suit for refund of a divisible tax of employment taxes (subtitle C) and IRC 6672 since levy action is prohibited during the suit, see IRC 6331(i).

TC 520 with closing codes 70 through 75 does not suspend the CSED.

TC 520 with closing codes 76 through 81 and closing code 84 suspends the CSED, unless a TC 550 (new CSED) is posted with a later transaction date.

Computing the CSED on an OIC case requires the application of several rules, depending on when the OIC was filed and/or accepted.

The Form 656, Offer in Compromise, waiver of the collection statute used prior to January 1, 2000, provided for a CSED suspension for a pending OIC plus 1 year. The CSED was suspended by contract.

Several legislative changes have provided or revoked the Service's ability to suspend the statutory period of collection for Offers in Compromise.

By signing the Form 656, the taxpayer waives the statutory period for assessment for periods included in the offer (See Form 656), beginning on the date the offer is deemed pending plus one additional year if the Internal Revenue Service rejects, returns, or terminates (due to the taxpayer’s death before acceptance) the offer or if the taxpayer withdraws the offer. Refer to IRM 5.8.10.8 , Effect of Previous Offers on Assessment Statute Expiration Date, to determine ASED suspension periods. The taxpayer cannot extend the CSED.

TC 480 suspends the CSED.

Refer to the chart located in IRM 5.8.10.7, Effect of Previous Offers on Collection Statute to determine the correct CSED suspense periods.

If an OIC is submitted during a Collection Due Process hearing, there will be different suspension periods running concurrently. The CSED suspension due to the CDP hearing will be longer. If the OIC is accepted for processing prior to the CDP hearing request, and transferred to Appeals for consideration as part of the CDP hearing, there will be overlapping suspension periods. For more information about CSED suspension during CDP Hearings, see IRM 5.1.9.3.6, Suspension of Collection Statute of Limitations, and IRM 8.21.5.5.5, Collection Due Process (CDP).

Effective March 9, 2002, the CSED is suspended during:

Transaction Code 971 Action Code 043 is input on accounts meeting “pending installment agreement” criteria. To meet pending installment agreement criteria, taxpayers’ request must provide specific information including:

If a pending installment agreement request, as described above, is submitted during a Collection Due Process hearing, there will be different suspension periods running concurrently. Generally, the CSED suspension due to the CDP hearing will be longer. There will be an overlap in CSED suspension when the installment agreement request is made prior to the CDP Hearing request or when the CDP request is withdrawn but the installment agreement request is not withdrawn. For more information about CSED suspensions during CDP Hearings, see IRM 5.1.9.3.6, Suspension of Collection Statute of Limitations, and IRM 8.21.5.5.5, Collection Due Process (CDP).

Although the Service can accept agreements to extend the period of limitations on collection in conjunction with installment agreements, the Service will do so only in limited situations. IRM 5.14.2, Installment Agreements - Partial Payment Installment Agreements (PPIA) and the Collection Statute Expiration Date (CSED), provides examples of appropriate situations to accept statute extension requests.

Although rare, you have the authority to secure a Form 900, Collection Statute Extension, in limited situations in conjunction with a PPIA. The waiver period should be determined based upon the situation, but should not exceed 5 additional years plus 1 year to provide for other administrative actions, and you should follow IRM 5.14.2 in considering whether an extension is appropriate.

The processing of Form 900 generates a TC 550 extending the CSED.

On timely filed CDP requests, Appeals is responsible for providing the TC 521 date, which is the date the collection statute will start running again. A TC 520 with a closing code of 76 or 77 reflects the date of receipt of a CDP request for hearing, which is the beginning date of the collection statute suspension. The TC 521 is then input when the Appeals determination and any additional appeal period becomes final. For more information on how the TC 521 is determined, see IRM 8.20.7.20.4, Determine the TC 521 Date for CDP Cases.

The date the Appeals determination becomes final is determined as follows:

If the re-computed CSED is less than 90 days from the TC 521, the CSED is extended to equal 90 days. The exception to the systemic update of the CSED is IMF accounts involving joint income tax liabilities where only one spouse has requested the hearing. For MFT 30 accounts, input the appropriate CSED indicator with the TC 520. The indicators are as follows:

The CSED is still suspended for the particular spouse when the CSED indicator is "P" or "S" However, the module will reflect the earliest CSED.

Because the statute will be computed by the system, it is vital that the correct TC 520 and TC 521 dates are reflected.

The period of limitations on collection after assessment is suspended while the taxpayer is outside the U.S. if the absence is for a continuous period of at least 6 months pursuant to IRC 6503(c).

To ensure the Government has an opportunity to collect the tax after the taxpayer’s return, the period of limitations does not expire (where the taxpayer has been out of the country for 6 months or more) until 6 months after the taxpayer’s return to the country.

When a case is in Appeals, you may encounter a situation where a taxpayer has been located outside of the U.S., and as a result a CSED suspension may be applicable. Because a CSED suspension may have a bearing on the particular collection resolution of a matter that is before Appeals, an Appeals Referral Investigation (ARI) should be used to request that Collection make a determination whether a CSED suspension is applicable.

Collection activity is suspended for the requesting spouse when he or she makes a qualifying request under IRC 6015(b), IRC 6015(c) and/or IRC 6015(f). Collection activity against the non-requesting spouse is not prohibited.

The collection period is suspended from the filing of the claim until a waiver is filed, or until expiration of the 90 day period for petitioning the Tax Court, or if a Tax Court petition is filed, when the Tax Court decision becomes final under IRC 7481, plus 60 days in each instance.

If a request for relief is made in response to the Collection Due Process procedure, there is also a concurrent suspension of the collection activity during the period provided for by IRC 6330(e), for the pending of any administrative hearing and appeals therein regarding the levy.

If the requesting spouse signs a waiver of the restrictions on collection, the suspension of the period of limitation on collection against the requesting spouse will terminate 60 days after the waiver is filed with the Agency, limiting the CSED extension to the period from when the claim was filed to the time the waiver was signed, plus 60 days.

A request for a reconsideration is not a qualifying request for relief for purposes of Treasury Regulation §1.6015-1(h)(5), and does not trigger the restrictions on collection pursuant to section 6015(e)(1)(B) or the suspension of the collection period of limitation under section 6015(e)(2).

IRC 7811(d) and the accompanying regulations provide that if a taxpayer submits a Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), or written equivalent defined in IRM 13.1.14, Taxpayer Advocate Procedures - Suspension of the Statutes of Limitation under IRC 7881(d), the statute of limitations on collection and/or assessment may be extended for a certain period.

Due to system programming limitations, the Commissioner decided in November 2003 that Taxpayer Advocate Service (TAS) does not have to input the appropriate IDRS codes to reflect the suspension of the statute of limitations under IRC 7811(d). The program limitations are still in effect. Therefore, IDRS codes are not input to show the correct suspension periods for IRC 7811(d) at this time. See IRM 13.1.14, Taxpayer Advocate Case Procedures - Suspension of the Statutes of Limitations under IRC 7811(d).

The payment of income tax on the income of a service member falling due before or during military service shall be deferred for a period not more than 180 days after termination of or release from military service, if the service member's ability to pay the income tax is materially impaired by his/her military service. The CSED is suspended during the taxpayer's military service and for an additional 270 days afterward.

The accrual of interest, penalties, and other additional amounts will resume 180 days after termination of, or release from, military service, but enforcement actions to collect the amounts due may be deferred for an additional 90 days.

TC 500 with Closing Code 51 suspends the CSED for Military Deferment. See IRM 5.1.7.13.1, Military Deferment Procedures and IRM 5.1.7.10.3 , Combat Zone Freeze Codes.

Individuals who serve in an officially designated combat zone will have payment and collection of any federal tax liability suspended during the period of the individual’s service in the combat zone, plus any period of continuous hospitalization (limited to 5 years of hospitalization in the United States) as a result of injury received while serving in the combat zone, plus the next 180 days thereafter. See IRM 5.1.19.3.8, Combat Zone or Contingency Operation. For exceptions, see IRC 7508(e).

The combat zone freeze code suspends the CSED, except in case of hospitalization, and can be set in two ways. See IRM 5.1.7.10.3, Combat Zone Freeze Codes.

TC 502 releases hold established by TC 500 and new CSED date is input by TC 550.

For more information see IRM 5.1.7.10, Accounts of Taxpayers who Serve in a Combat Zone.

More information on combat zone designations and qualifications may also be found in IRM 5.19.10.6.2, Combat Zone Qualified Individuals and Areas and IRM 5.19.10.6.2.1, Civilian Contractors Working in Support of the Combat Zone.

A wrongful levy suspends the running of the period of limitation on collection, See IRC 6503(f)(1). The collection statute is suspended from the date property (including money) of a third party was wrongfully seized or received, to the date the property is administratively returned pursuant to IRC 6343(b), or to the date on which a wrongful levy judgment with respect to such property becomes final, and 30 days thereafter. Additions under this provision can be identified on IDRS as TC 550 with a definer code 08.

Generally, when the period of limitation is suspended under this provision, it is suspended only for the amount of money or value of specific property which initially has been wrongfully taken from a third party and subsequently returned. This amount or value is determined as of the date the property was returned. See IRM 5.17.3, Levy and Sale, and IRM 5.10.6 , Post Sale Actions and Responsibilities of Advisory.

A wrongful lien suspends the running of the period of limitation on collection. See IRC 6503(f) (2). The collection statute is suspended from the date any person becomes entitled to a certificate of discharge of lien under IRC 6325(b)(4) until the earlier of:

Generally, when the period of limitation is suspended under this provision, it is suspended only for the value of the interest to the United States in the property plus interest, penalties and additions to tax and additional amount attributable thereto. See IRM 5.17.2, Federal Tax Liens.

The general estate tax lien under IRC 6324(a) arises automatically upon the death of a taxpayer. The lien attaches to all assets that are part of the decedent's gross estate and are required to be reported on Form 706, U.S. Estate Tax Return.

Appeals Technical Employees working estate tax cases should be aware that while the statute for collection based on the assessment and life of the IRC 6321 lien may be extended, the general estate tax lien has an absolute life of 10 years and cannot be extended.

When payment of the estate tax is deferred under IRC 6166, the executor may grant the Agency a lien under IRC 6324A instead of the bond provided for under IRC 2204 or IRC 6165.

The IRC 6324A lien attaches specifically to the property designated on Form 13925. The deferral period and subsequent installment payments may last up to 15 years.

The statue of limitations for collection of estate tax is suspended for the period of any extension of time to pay granted under IRC 6166 (for the amount of extension only).

The CSED is suspended during:

The CSED is not suspended while an installment agreement is in effect.

You must first determine if the any of the mandatory acceptance provisions, as described in IRM 8.21.5.7 apply to the offer by following the instructions below.

If the OIC meets one of these criteria you must determine the IRS received date.

If the STATDATE is within the next six months, expedite resolution of the case.

If the 24 month period has expired follow the procedures in IRM 8.21.5.7.2.

If there are any questions about the whether the 24 month period has expired, contact Area Counsel.

See IRM 8.23.2 for situations where a TIPRA statute case is open and fewer than 120 days remain on the IRC 7122(f) period.

If it appears the 24 month period may have expired, the hearing officer or Tax Examiner should:

The Appeals Team Manager (ATM) or Processing Team Manager (PTM) should:

Within thirty (30) workdays from the preliminary memorandum, the ATM should prepare a final memorandum to the appropriate Director, through their Area Director. The PTM should prepare a final memorandum to the Director, APS, through their Area Manager. This memorandum should explain the reason(s) the 24 month period expired without a decision being made on the OIC, why further administrative action is or is not warranted, and include any proposed disciplinary action(s). The final memorandum prepared by the ATM or PTM should include the following information.

The final memorandum from the ATM should be processed as follows:

The final memorandum from the PTM should be processed as follows:

The final memorandum should include an explanation of the recommended disciplinary action against each employee deemed responsible. However, the report should never contain the names of the employees involved.

It is possible for more than one Appeals employee to have handled the case and contributed to the 24 month mandatory acceptance of the OIC.

The manager of the employee who last handled the case will be responsible for contacting the managers of the other employees involved. All of the managers impacted should discuss how the back-up documentation will be gathered and which manager will prepare the final memorandum. The manager of the employee who last handled the case will normally coordinate and be responsible for the preparation of the final memorandum.

After the final memorandum is prepared, the draft will be electronically shared with all managers who had employees who contributed in any way to the mandatory acceptance of the OIC. Each should be allowed an opportunity to review and concur with the memorandum before it is forwarded for approval.

All managers who are given an opportunity to review the report should indicate their concurrence with the memorandum by E-mail to the coordinating manager, who will note in the final memorandum that all managers of employees that contributed to the mandatory acceptance were provided copies of the draft report and have concurred.

As a general rule, all employees who contributed in any way to the mandatory acceptance of an offer in compromise may be subject to some form of disciplinary action. This disciplinary action is for failure to protect the 24 month mandatory acceptance time frame rather than for any perceived monetary loss to the government. Any discipline will not necessarily be the same for all involved employees.

When determining the level of disciplinary action, the following facts should be considered for each employee:

The facts of each case are different, so the level of each employee's responsibility will be determined on a case-by-case basis.

In most cases involving an offer in compromise's mandatory acceptance, multiple employees may have contributed to the situation which resulted in the mandatory acceptance of an offer in compromise. All factors must be considered when determining the degree of responsibility for each employee.

Depending upon the circumstances it is possible no employees will be found to be subject to some form of disciplinary action.

Even though an employee has jurisdiction of a case on ACDS, another employee may have actual possession and virtual control over the movement of the case. However, not being able to control the movement of a case does not relieve the employee with jurisdiction from continuing to take every possible action to get the employee with possession and control of movement to act appropriately

When an employee with possession and control of movement of a case fails to adhere to the employee with jurisdiction's requests to handle the case in a timely manner, the employee with possession and control may be held fully responsible for the lapse of the 24 month period.