Question: I’m paying the IRS tax 1040 for 1997 and 1998.  How long do I have to pay theses taxes?  Is there a time limit?  I thought it was only ten years.  Why amd I still paying?

Answer: This is a great question.  You are correct, that after you have filed your tax returns and the IRS has assessed a tax against you they can only collect that tax for ten years.  That is the collection statute of limitations.  So, if you filed your 1997 tax returns on time on April 15, 1998, then the IRS would have assessed those taxes effective April 15, 1998 and if you owed a balance and have been paying on them since 1998 you would have to continue paying through April 15, 2008.  The same is true for the 1999 taxes, except that you will have to pay those until April 15, 2009.

In some cases that is the end of the answer.  However, you can do certain things that cause the statute of limitations to be put on hold.  If you filed bankruptcy, an offer in compromise or filed a collection due process hearing appeal then while those events were taking place or being considered by the IRS the collection statute was placed on hold.  That means the ten year countdown stopped and picked back up when the triggering event was over.  Need an example?  Lets say you decided to file an offer in compromise which you filed on February 1.  It was considered for six months and on September 1 your offer was rejected on appeal and the account was returned to collections.  On September 1, you account would pick back up counting down the ten years and effectively the statute of limitations was extended by six months.

Now, the question is, how do you know if something has come up or when the taxes were assessed so you can determine when the statute of limitations will expire?  You can fill out a Form 4506-T and ask for a Record of Account for the years in question.  The Record of Account reads much like a bank statement and is arranged in chronological order so you can see when the tax was assessed and if there were any triggering events like a bankruptcy filing, when the IRS was notified that the bankruptcy was discharged, etc.

Hope this helps answer your question!