Certain transaction codes (TC) codes with specific reference numbers carry their own CSEDs, and display them on the Integrated Data Retrieval System (IDRS).

A list of these TC codes follows:

Certain actions allow for a suspension or extension of the CSED.

IDRS TC codes that suspend or extend CSEDs include but are not limited to:

A TC 550 extends a CSED to the date input with this transaction on an IMF account.

To further identify the use of the TC 550, a list of definer codes and their use follows:

The collection statute of limitations, in a case under the Bankruptcy Code, is suspended while the Service is prohibited by reason of the case from collecting, and for 6 months thereafter. For more information see IRC 6503(h)(2). Thus, the collection statute of limitations is generally suspended while the automatic stay imposed by the bankruptcy is in effect. Even if the suspension of the collection statute under IRC 6503(h) no longer applies, the collection statute still may be suspended when substantially all the debtor’s assets remain in the custody or control of the bankruptcy court under IRC 6503(b). For more information see IRM 5.9.4.2.

The statute of limitations for collection is found in IRC 6502. When a suit to reduce the tax liability to judgment is in the government's interest, it must be filed prior to the statute's expiration. The 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.

The CSED is suspended from the date the Service receives a timely filed request for a CDP hearing to the date the taxpayer withdraws their request for a CDP hearing or the date the determination from Appeals becomes final, including any court appeals. If 90 days is not remaining on the statute of limitations when the determination becomes final, the statute of limitations is extended to equal 90 days. The collection statute is not extended for equivalency hearings. For more information see IRM 5.1.9.3.6 and Treas. Reg. § 301.6330–1(g)(3), ex.1.

For offers pending prior to 1/1/2000, the CSED extension was impacted by Treasury Regulation § 301.7122–1(f) (1960). Under this regulation the practice of the Service generally was to obtain from the taxpayer a waiver of the collection statute for the period the offer in compromise was being considered, while any term of an accepted offer was not completed, and for one additional year.

Under the IRS Restructuring and Reform Act of 1998 (RRA 98) the waiver cannot extend the CSED beyond either 12/31/2002 or the original CSED, whichever is later. Suspensions of the running of the collection statute in the offer in compromise context are governed by statute, specifically by IRC 6331(k)(1) and (3). Under these provisions, the Service is prohibited from levying, and the running of the collection statute is suspended, while an offer is pending with the Service, for 30 days immediately following a rejection of the offer, and for the period that a timely filed appeal of a rejection is being considered in Appeals. CSED extensions for the period of time "while any term of an accepted offer is not completed" and "for one additional year" are eliminated.

The Community Renewal Tax Relief Act of 2000, effective December 21, 2000, eliminated the suspension of the statutory period for collection while offers and installment agreements were pending.

The Job Creation and Workers Assistance Act of 2002 reinstated the statute suspension with respect to both offers and installment agreements. With respect to offers, the collection statute is again suspended beginning March 9, 2002 for the number of days the offer remains open from March 9, 2002, for the number of days the offer is pending, for thirty days after rejection of the offer, and for the period that a timely filed appeal of a rejection is being considered in Appeals.

Cases may be encountered where prior rules were in effect. The following chart shows the changes that have occurred in this area.

If only one party to a joint assessment files an OIC, then the statute is suspended just for that person. The appropriate CSED suspension code must be input on IDRS to identify the specific taxpayer for which the offer applies. They are described below.

For more information see IRM 5.8.10.7.

Form 900 Waiver will only be executed in connection with granting a partial payment installment agreement and only in certain situations. See IRM 5.14.2.1.3. IRS Policy dictates Form 900 Waiver is limited to no more than five years, plus up to one year to account for changes in the agreement. Effective March 9, 2002, the CSED is suspended during:

For more information see IRC 6159(a), IRC 6331(k), and IRC 6502(a)

Collection by levy or a proceeding in court against a spouse is suspended for the requesting spouse when he or she makes an election under IRC 6015(b), and/or IRC 6015(c). Collection is suspended for claims filed under IRC 6015(f) if the liability was unpaid as of December 20, 2006 or the liability did not arise until after December 20, 2006. For more information see IRM 25.15.1.8.

The collection period is suspended from the filing of the claim until a waiver is filed or until the 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, plus in each instance, 60 days.

If a request for relief is made in response to collection due process procedures, there is also suspension of collection activity and the collection period provided for by IRC 6330(e) for the pending of any administrative hearings and appeals therein regarding the levy. The rules for suspension under IRC 6330 differ from IRC 6015. In general, the latest suspension of collection and the collection period should control, which may require analyzing the suspension under both IRC 6015 and IRC 6330 where relief from joint and several liability is requested as part of an IRC 6330 hearing.

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

The period of limitations on collection after assessment is suspended while the taxpayer is outside the United States if the absence is for a continuous period of at least six months per IRC 6503(c). To make certain that the Government has an opportunity to collect the tax after the taxpayer's return, the period does not expire (where the taxpayer has been out of the country for six months or more) until six months after the taxpayer's return to the country. As the application of this provision can result in the CSED being suspended for a very long time, policies for the administration of this code section are now established.

The deadline for certain acts performed by taxpayers and the Service is postponed when the taxpayer serves as follows:

The acts specified in IRC 7508 include paying income, estate, or gift tax, and collecting any tax. The regulations under IRC 7508 expand the list of covered acts to the payment of employment tax and most excise taxes. (Also, Rev. Proc. 2004-13, or its successor, expands the list provided in the statute and the regulations.) A deadline is postponed while the taxpayer serves in the area or operation and for any period of continuous hospitalization from such service (limited to five years of hospitalization in the United States), plus 180 days after the last day of service in the area or operation or period of hospitalization. See IRC 7508(e) for exceptions concerning tax in jeopardy, cases under title 11 of the USC (bankruptcy), and transferred assets. For more information see IRM 5.1.7.9.

The combat zone or contingency operation freeze code suspends the CSED and can be set in two ways:

Once the a taxpayer has been in a Combat Zone the "-C" freeze remains on the account for historical purposes, even with accurate entry and exit dates.

Under the Servicemembers Civil Relief Act (referred to as Section 510, Title 50 Appendix), the collection of any income tax due from any person in the military service, whether falling due before or during military service, may be deferred up to 180 days if ability to pay the tax is materially impaired because of that person's military service. The CSED is suspended during the taxpayer's military service and for an additional 270 days afterward.

Transaction Code 500 with Closing Code 51 suspends the CSED for a Military Deferment. For more information see IRM 5.1.7.12.1.

A wrongful levy suspends the running of the period of limitation on collection pursuant to IRC 6503(f)(1). The collection statute is suspended for a period equal to the period from the date property is wrongfully seized or received to the date returned under IRC 6343(b) or the date on which a judgment is secured under IRC 7426, plus an additional 30 days. The suspension is only applicable to an amount equal to the amount of money or the value of the property returned. For more information see IRM 5.10.6.15.

A wrongful lien suspends the running of the period of limitations on collection. Under IRC 6503(f)(2) the collection statute is suspended from the date any person becomes entitled to a certificate of discharge of lien under section IRC 6325(b)(4) until the earlier of the earliest date on which the Service no longer holds any amount as a deposit or bond under section IRC 6325(b)(4) or the date on which a judgment under section IRC 7426(b)(5) , concerning the amount deposited or used as bond, becomes final. Where the period of limitations is suspended under this provision, it is suspended only for the value of the interest of the United States in the property plus interest, penalties, additions to tax, and additional amounts attributable thereto.

Taxes assessed on Form 706 U.S. Estate Tax Return, are allowed various special elections under the Internal Revenue Code that allow for deferral of payment of estate taxes due. Under IRC 6503(d), the CSED is suspended for the period of any extension of time for payment that is granted.

Generally there are two Code sections that would be commonly seen on collection accounts, IRC 6166 and IRC 6161, that allow deferral of payment for estate tax due. Estates must meet specifications outlined in the Code in order to qualify for these payment deferrals.

IRC 6166 allows for annual installment payments over a 15 year period. TC 488 (or status 14) is input on IDRS to identify accounts that may have been granted a payment deferral under IRC 6166. Generally the CSED is extended for the period of time between the TC 488 date and TC 489 date (the time period in status 14), which reflects reversal of the allowance of this special election. IRM 5.5.7 provides additional information on collection of estate tax accounts and the CSED.

IRC 6161 allows an extension to pay estate taxes in 12 month increments, up to 10 years. TC 468 is input on IDRS to identify accounts that may have been granted additional time to pay estate taxes due under IRC 6161. Generally the CSED is extended for the period of time between the TC 468 date and the TC 469 date, which reflects expiration of the extended time to pay. IRM 5.5.5 provides additional information on IRC 6161 accounts and the CSED.

An extension to pay under IRC section 6161 may be requested on annual installment payments deferred under IRC section 6166. If granted the additional period of time allowed to pay the installment payment should be added into the CSED calculation.

CSED's should always be checked when working estate tax accounts. The Advisory Estate Tax group can provide assistance with proper calculation of the CSED.

The tax liens under IRC 6324(a) and IRC 6324(b) expire exactly 10 years from the decedent's death or the date of the gift, respectively, whether or not any action for the collection of such tax has been commenced or the CSED under IRC 6502 remains open.

IRC 7811(d) requires the suspension of the applicable statutes of limitations (assessment and collection) on the filing of Form 911, Application for Taxpayer Assistance Order (criteria one through seven) signed by the taxpayer or duly-authorized representative when the request for relief involves an action described in IRC 7811(b). For more information see IRM 13.1.14.

IRC 4961(c) also suspends for period of collection for second-tier taxes, if an action for refund on the first-tier tax is commenced not later than 90 days after the day on which the second-tier tax is assessed. See IRM 7.27.15.3.4 for complete details.

When a taxpayer fails to file a timely income tax return or files a false or fraudulent return, the Service may execute a return under the authority of the IRC 6020(b) deficiency procedures. If the taxpayer fails to respond to the 90 day notice, the Service makes a deficiency assessment. The Service may also make a deficiency assessment if the deficiency is upheld by the Tax Court. Upon that assessment, the 10 year period of limitations on collection, provided for in IRC 6502(a)(1) begins.

If the taxpayer later files their own "original" return showing a tax liability smaller than the assessed liability, and that return is accepted by the Service as filed, the tax liability may be reduced to show the amount of tax reflected on the taxpayer's return. The original CSED date remains intact.

If the taxpayer's "original" return reflects more tax than that assessed from the statutory notice based on the section 6020(b) return, then an additional assessment is input for the increased amount. In this scenario, the original CSED remains intact and a second CSED will be systemically established based on the additional assessment.

Revenue Officers are responsible for monitoring their own imminent CSEDs. Some of the various ways to do this are:

Imminent CSED accounts should be worked to an appropriate conclusion prior to the statute expiration whenever circumstances permit. Appropriate case actions on imminent CSED accounts depend on the specific facts of the case.

Newly received imminent CSED accounts should receive taxpayer contact as soon as possible.

Timely follow-ups should be made and there should be no lapses in case activity.

Imminent CSED accounts sometimes include modules that do not have imminent CSEDs. It is important that all modules are worked appropriately. However, low dollar imminent CSED accounts should not receive undue or excessive attention simply because the collection statute is imminent.

Cases should not be closed with an inappropriate Currently Not Collectible (CNC) closing code merely because an imminent CSED is about to expire on one or more modules. If an investigation has been completed prior to the expiration that shows the account to be truly uncollectible, based on the facts of the case, all modules should be reported as such under the appropriate CNC closing code as directed in IRM 5.16.1.

Upon receipt of an imminent CSED module, or when CSED(s) become imminent, the revenue officer and group manager will discuss the imminent CSED(s) during the first Collection Consultation (CC) following receipt and agree on the most appropriate plan of action based on the facts of the case. During the CC, the group manager will document the initial plan of action in the case history. If the revenue officer receives a case with 120 days or less left on the CSED, the revenue officer will make an immediate appointment to discuss the case as an ad hoc CC.

During subsequent Collection Consultations or as facts warrant, the revenue officer will keep the group manager advised of the progress of all imminent CSED modules.

When 120 days remain until CSED, the group manager will notify the territory manager via secure E-mail advising of the imminent CSED and to review the case history for documented plan of action to resolve it. The group manager will provide an electronic copy of the E-mail to the revenue officer to place in the case file.

If the revenue officer has taken all appropriate case actions without resolving the imminent CSED module prior to expiration, it may be permissible to let the collection statute expire in inventory with the group manager's prior concurrence.

The revenue officer must document the case history with a summarizing statement that contains the specific MFT, Tax Period, Amount, CSED and facts to support the decision prior to statute expiration.

The group manager will review the summary and case history. If the group manager does not concur, the group manager and revenue officer will discuss and document a new plan of action.

If a collection statute expired without the group manager's prior concurrence or due to inappropriate case actions, the revenue officer will enter a statement in the case history addressing the reasons why the statute expired. The statement should include any unusual or mitigating circumstances. The group manager will review the summary, case history, and any other relevant information to determine if further administrative action is warranted, and whether disciplinary action is appropriate. The group manager will prepare a memo to the territory manager detailing why the CSED expired, why further administrative action is or is not warranted, and to include discipline if appropriate. The territory manager will review the memo and determine if it should be forwarded to the area director for recommended potential disciplinary action.

Statute expiration will normally generate a TC 608 credit to zero out a module within several cycles. Therefore, in most instances, it is not necessary to prepare a Form 53 to report an expired CSED account.

In some instances, such as non-master file and filing a suit, it will be necessary to prepare a Form 53 using closing codes 04 or 05. For more information see IRM 5.16.1.2.2.2 and IRM 5.16.1.2.2.4.