The collection statute expiration date (CSED) and what suspends it

The 10-year rule

IRC 6502(a)(1) allows the IRS to collect a timely assessed tax by levy or court proceeding “within 10 years after the assessment of the tax.” IRM 5.1.19.1.1: “Each tax assessment has a Collection Statute Expiration Date (CSED).” It continues: “The collection statute expiration ends the government's right to pursue collection of a liability.”

Because each assessment has its own date, one tax year can carry several CSEDs: the original return assessment, a later examination assessment, and penalties that IDRS tracks separately. IRM 5.1.19.2.1 lists transaction codes that carry their own CSED, including additional tax assessments (TC 290, 300) and certain penalties. It also flags a current problem: for additional assessments tied to reversed COVID-19 employer credits, IDRS may compute the CSED from the credit reversal date instead of the assessment date, and the IRM says the CSED should reflect the assessment date.

There is one notable exception to the 10-year rule. Restitution ordered solely as a condition of probation or supervised release can be administratively collected only during that period (IRM 5.1.19.3).

The period attaches to the tax debt, not to each person who may owe it. In United States v. Galletti, 541 U.S. 114 (2004), a partnership's employment taxes were timely assessed against the partnership, and the general partners argued the government could not collect from them because it had never separately assessed them within the three-year assessment period. The Supreme Court held that “the proper assessment of the tax against the partnership suffices to extend the statute of limitations for collection of the tax from the general partners who are liable for the payment of the partnership’s debts”, reasoning that “it is the tax that is assessed, not the taxpayer.” The case arose in a bankruptcy claim, so the holding speaks to the 10-year period for collection by court proceeding, but its logic is general: a partner, transferee or other person who is secondarily liable under state law cannot defeat collection by pointing to the absence of an assessment in their own name. Compute the CSED for such a client from the entity's assessment date and the entity's suspension events.

Events that suspend the CSED

Some details matter in practice:

• An agreement in effect does not suspend. IRM 5.1.19.3.5: “The CSED is not suspended while an installment agreement is in effect.” Only the pending period and the post-rejection or post-termination windows count. On termination, IRC 6331(k)(2)(D) suspends the statute for the 30 days after the agreement is terminated and during a timely CAP appeal of the termination. When termination occurs is where the IRM is inconsistent: IRM 5.14.11.4 says a defaulted agreement “will not be terminated until the expiration of the 30 day period beginning on the date the notice is issued” and calls 30 days from the CP 523 the termination date of record, with a further 30 days to appeal the termination under IRM 5.14.11.7, while a note in IRM 5.1.19.3.5 says the agreement is deemed terminated on the 60th day after the CP 523 or Letter 2975 unless a CAP hearing is requested within 30 days. IDRS itself posts the TC 971 AC 163 that adds the 30 days 13 cycles after the CP 523 (IRM 5.14.11.4). Recompute from the notice date rather than trusting the posted code.
• Returned offers carry no 30-day tail. The 30 days after an offer closes are suspended only “if such offer is rejected by the Secretary” (IRC 6331(k)(1)(B)), because that window exists for the appeal. An offer returned after processing suspends the CSED only for the period it was pending: IRM 5.8.7.2.2 says a processable return “will result in suspension of the collection statute for the period of time the offer was considered processable” and that a taxpayer whose offer is returned “does not receive appeal rights.” A not processable return suspends nothing. See offers in compromise for the return versus rejection distinction.
• Equivalent hearings do not suspend. IRM 5.1.19.3.3: “The collection statute is not extended for equivalency hearings.” Pub 594 says the same. A late CDP request therefore costs the taxpayer Tax Court review but preserves the statute.
• Joint liabilities split. If only one spouse files bankruptcy, an offer, a CDP request or an innocent spouse claim, the suspension applies only to that spouse, and IDRS uses P, S or B indicators. For a joint non-mirrored module, the CSED is determined for each spouse separately.
• TAO suspensions are not coded. IRM 5.1.19.3.13 explains that due to programming limits, “IDRS codes are not input to show the correct suspension periods for IRC 7811(d) at this time.” The CSED shown on IDRS will not reflect a Form 911 suspension.

How overlapping suspensions count

IRM 5.1.19.3: “Overlapping suspensions run concurrently; they are not cumulative.” Its example: a 2008 Form 1040 assessed June 1, 2009 has an original CSED of June 1, 2019. The taxpayer enters a combat zone on May 10, 2014 and leaves March 1, 2015 (suspension through August 28, 2015 with the 180 days), then submits an offer on April 20, 2015 that is rejected October 17, 2015 (suspension through November 16, 2015 with the 30-day appeal window). Because the periods overlap from April 20 to August 28, 2015, that stretch counts once. The CSED is extended 555 days, to December 7, 2020.

Extensions: waivers and judgments

Waivers. IRC 6502(a)(2)(A) allows an extension agreed in writing at the time an installment agreement is entered into; the extended period runs until 90 days after the agreed date. Since July 2005, IRS policy limits Form 900 waivers to certain partial payment agreements, “limited to no more than five years, plus up to one year to account for changes in the agreement” (IRM 5.1.19.3.5). A waiver is recorded with TC 550 definer code 01. Waivers obtained before January 1, 2000 that were not tied to an installment agreement expired on December 31, 2002 or the original CSED, whichever was later.

Release of levy. IRC 6502(a)(2)(B) also allows an agreed extension when a levy is released after the 10-year period.

TC 550 definer codes. Every manual change to the IDRS CSED posts as a TC 550 with a definer code that says why. IRM 5.1.19.2.3 lists them:

A TC 550 is a correction or extension, not a suspension code, so a definer code 03 or 07 on a transcript usually means someone recomputed a bankruptcy or offer suspension by hand. Document 6209 describes TC 550 as extending the CSED to the date input with the transaction, with an optional P, S or B indicator on IMF accounts for which spouse it applies to.

Suits and judgments. If the government files suit before the CSED, collection by levy continues until the liability or judgment is satisfied or becomes unenforceable (IRC 6502(a)). IRM 5.1.19.3.2.2 says that when a judgment is entered, the IRS inputs TC 550 definer code 04 “using 20 years from the date the judgment was entered as the new CSED.” The suit must be filed before the CSED to have this effect.

Computing the CSED from transcripts

1. List every assessment. For each module, note each assessment date (TC 150 and later TC 290 or 300 assessments, and penalty assessments that carry their own CSED).
2. Add 10 years to each. That is the base CSED for that assessment.
3. Find suspension codes. TC 971 AC 043 to TC 972 AC 043 or TC 971 AC 063 (pending IA); TC 971 AC 163 (terminated IA, 30 days); TC 480 to TC 481, 482 or 780 (offer); TC 520 with closing codes 76 to 77 (CDP) or 60 to 67, 81, 83, 85 to 89 (bankruptcy, plus six months); TC 500 (military and combat zone).
4. Merge overlapping periods and add the merged total to the base CSED.
5. Apply the 90-day CDP floor if fewer than 90 days remained when a determination on a timely CDP request became final (IRC 6330(e)(1)). It applies only to timely requests; an equivalent hearing gets neither the suspension nor the floor (Treas. Reg. 301.6330-1(i)(2), A-I3).
6. Check for events not coded on IDRS, such as Form 911 applications or time abroad.
7. Compare with the IDRS CSED and request correction if they differ. The statute date calculator handles the arithmetic.

See reading an account transcript for where these codes appear.

The CSED itself is not on the transcript. IRM 21.2.3.2.2 describes the tax account transcript as the Master File transactions seen on command code IMFOLT or BMFOLT, and lists its contents: payment, refund, penalty and interest history, balance due with accruals, adjusted gross income, taxable income, credits and the return received date. The CSED field that IDRS computes is not in that list and does not print on the public transcript, which is why the steps above work from the transaction codes. To see the IRS's own figure, ask the assigned revenue officer or ACS for the IDRS CSED on each module, use the Respond Directly process (IRS employees may release open case file records to the taxpayer or representative under IRC 6103(e) without a FOIA request), or file a FOIA request for the IDRS account prints. IRM 5.1.19.6 requires revenue officers to document any manual CSED recalculation in the case history in enough detail for a manager to follow, so that history is worth requesting too. The transcript analyzer pulls the assessment and suspension codes from a pasted account transcript and computes the dates.

When the CSED expires

Collection ends for that assessment. IDRS writes off the expired balance (TC 608 for the whole module, or TC 534 for fewer than all assessments in a module, per IRM 5.1.19.5.4.1). Any later collection is refundable: IRC 6401(a) defines an overpayment to include tax “which is assessed or collected after the expiration of the period of limitation properly applicable thereto.”

Before expiration, revenue officers work imminent CSED cases and may let a statute expire only with group manager concurrence and a documented summary (IRM 5.1.19.5.4). Payments are steered toward the oldest dates: “Apply payments to the balance due module with the most imminent CSED first” (IRM 5.1.19.4), which applies to levy proceeds, installment payments and undesignated voluntary payments. A taxpayer can designate voluntary payments to a different module.

Using the CSED in case planning

• Before filing a request, count its cost. An offer, a pending installment agreement, a CDP hearing or a bankruptcy each adds time. For a balance near its CSED, a request with little chance of success can extend collection more than it helps.
• PPIA versus offer. When few years remain, total PPIA payments to the CSED may be less than an offer amount. See PPIAs and offers.
• CNC runs the clock. CNC is not a suspension event, so an account that stays CNC can expire. See CNC.
• Refuse waivers knowingly. Taxpayers may refuse to sign Form 900; the cost is that the PPIA request is recommended for rejection (IRM 5.14.2.3).

Questions practitioners ask