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5.1.19  Collection Statute Expiration

Manual Transmittal

May 19, 2016


(1) This transmits revised IRM 5.1.19, Field Collection Procedures, Collection Statute Expiration.

Material Changes

(1) IRM Overview reformatted and the next two subsections renumbered.

(2) IRM added about updating the ICS CSED.

(3) IRM added about contacting Insolvency with questions about the effect of bankruptcy on the CSED.

(4) IRM and revised.

(5) IRM revised to include cross reference IRM, TC 520 Closing Codes.

(6) IRM revised to update tax liability language to assessments

(7) IRM, Suit to Reduce Assessments to Judgment, added.

(8) IRM added about reconsideration request.

(9) IRM revised to update reference to a valid offer in compromise.

(10) IRM revised by updating reference to periodic payment offers in compromise for which the payment schedule is up to 24 months.

(11) IRM revised (4)(c) and example.

(12) IRM (4) added about case documentation.

(13) IRM contains information on postponement of certain acts for taxpayers serving in a combat zone. Legislation effective December 18, 2015, resulted in an exception for the collection period in cases involving taxpayers in continuous qualified hospitalization for injury sustained while serving in a combat zone.

(14) IRM added about additional combat zone extension.

(15) IRM and subsequent subsections renumbered, examples added at (3).

(16) IRM, Expiration of the Collection Statute for Fewer than All Assessments, added.

(17) Editorial changes made throughout.

Effect on Other Documents

This supersedes IRM 5.1.19, dated November 22, 2013.


SB/SE Employees in Field Collection, Specialty Collection - Offers, Liens and Advisory, and Specialty Collection Insolvency

Effective Date


Kristen E. Bailey
Director, Collection Policy  (11-22-2013)

  1. This IRM provides an overview of actions that suspend or extend the Collection Statute Expiration Date (CSED) for SB/SE employees in Field Collection, Specialty Collection - Offers, Liens and Advisory and Specialty Collection - Insolvency. Specific details are covered in the applicable IRM.  (05-19-2016)
Collection Statutes

  1. Each tax assessment has a CSED. Internal Revenue Code section 6502 provides that the length of the period for collection after assessment of a tax liability is 10 years. The collection statute expiration ends the government's right to pursue collection of a liability.

  2. Prior to its amendment by the Restructuring and Reform Act of 1998 (RRA 98), section 6502(a) of the Internal Revenue Code authorized the Secretary to accept waivers extending the statute of limitations on collection after assessment prior to the expiration of the collection period. The Code did not place any restrictions on the length of the extension, the number of times an extension could be granted, or the circumstances under which an extension could be obtained. The RRA 98 significantly amended IRC section 6502. Extensions in effect on December 31, 1999, are subject to the following,

    If Then
    The waiver was secured "in connection with" the granting of an installment agreement The period for collection expires 90 days after the date specified in the waiver.
    The waiver was not obtained at the same time as an installment agreement The period for collection expires not later than December 31, 2002, or the end of the original collection statute.
  3. Waivers of the collection period are secured only when the extension is agreed to:

    1. At the same time a partial payment installment agreement is made, when appropriate (see IRM, Waiver Procedures for Partial Payment Installment Agreements, or

    2. Prior to a release of levy under IRC 6343 that occurs after the expiration of the statutory ten-year period for collection.  (05-19-2016)
Collection Statute Date Update

  1. You must be aware of CSEDs on accounts you are responsible for and take appropriate case actions to protect the CSED.

  2. Ensuring the CSED is correct is important to collecting the correct amount due and observing taxpayer rights.

  3. The CSED reflected on ICS and IDRS may not always be correct because, at times, actions that suspend or extend the CSED occur simultaneously, increasing the complexity of computing the CSED and requiring manual recalculation.

  4. If you encounter an erroneous CSED while working your case, manually calculate the correct date and follow procedures to update it on ICS and IDRS.

  5. Document the case history with the steps you followed to manually calculate the CSED prior to submitting the update to the group manager for approval. The group manager will review the CSED calculation and, if it is accurate, approve the update.

  6. If the CSED reflected on IDRS is for an assessment that is satisfied, it is not an erroneous CSED.

    • Do not request TC 550 to change the CSED to the date for a later unsatisfied assessment.

    • Do update the ICS CSED to the current CSED for a later unsatisfied assessment.  (06-04-2009)
Transaction Codes that Affect the CSED

  1. In addition to Transaction Code (TC) 150 - Tax Assessed, there are certain other TC codes that carry their own CSEDs.

  2. And other TC codes that suspend or extend the expiration date.  (06-04-2009)
Transaction Codes that Carry Their Own CSED

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

  2. A list of these TC codes follows:

    Transaction Code Definition
    TC 160 Manually Computed Delinquency Penalty
    TC 166 Delinquency Penalty
    TC 170 Estimated Tax Penalty
    TC 176 Estimated Tax Penalty
    TC 180 Deposit Penalty
    TC 186 FTD Penalty
    TC 234 Daily Delinquency Penalty (if it is the only CSED in the module)
    TC 238 Daily Delinquency Penalty
    TC 240 Miscellaneous Civil Penalty (all except for Reference Codes 697 and 699)


    Because of a programming error, TC 240 with penalty reference numbers 680, 681, 682, and 686, posted prior to January 2009, may contain an incorrect CSED on BMF accounts. For collection purposes, TC 240 with reference numbers 680, 681, 682, and 686 has the same CSED as the related tax assessment (TC 290 or TC 300) regardless of the CSED computed on Master File as part of the TC 240.

    TC 246 Form 8752 or Form 1065 Penalty
    TC 290 Additional Tax Assessment
    TC 294 Tentative Carryback Disallowance with Interest Computation Date
    TC 298 Additional Tax Assessment with Interest Computation Date
    TC 300 Additional Tax or Deficiency Assessment by Examination or Appeals
    TC 304 Tentative Carryback Disallowance by Exam with Interest Computation Date
    TC 308 Additional Tax or Deficiency Assessment by Examination or Appeals with Interest Computation Date
    TC 320 Fraud Penalty
    TC 350 Negligence Penalty
    TC 340 Restricted Interest (Doc Code 47 and 51 only)  (05-23-2013)
Integrated Data Retrieval System (IDRS) Transaction Codes (TC) That Suspend Or Extend A CSED

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

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

    Transaction Code Description
    TC 468 Extension of Time to Pay Estate Tax


    IDRS will allow more than one TC 468 and will recognize the last one posted.

    TC 480 Offer in Compromise Pending (suspends CSED)
    TC 488 Installment and/or Manual Billing (extends CSED)
    TC 500 Military Deferment (suspends CSED)
    TC 520
    cc 76-81
    IRS Litigation Instituted (suspends CSED)
    TC 520
    cc 60-67, 83, 85-89
    Bankruptcy (suspends CSEDs)
    TC 520
    cc 82
    CVPN with appeal rights (suspends CSED)
    TC 550 Waiver Extension of Date Collection Statute Expires (extends the CSED to date input)
      For IMF accounts only, an optional CSED TIN indicator can be used to identify which taxpayer the extension applies to:
    (P) Primary; (S) Secondary; or, (B) Both .
    TC 971
    Action Code 043
    Pending Installment Agreement
    TC 971
    Action Code 163
    Terminated Installment Agreement  (06-04-2009)
TC 550 Waiver Extension Definer Codes

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

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

    Definer Code Description
    01 Form 900
    02 Assets in Custody of the Court
    03 Bankruptcy (incorrect CSED computation)
    04 Judgment
    05 Taxpayer Assistance Order (TAO)
    06 Military Deferment
    07 Offer in Compromise (incorrect CSED computation)
    08 Wrongful Seizures
    09 Taxpayer Living Outside the U.S.
    10 Other (Collection Due Process)  (01-01-2006)
Case Actions That Can Suspend And/Or Extend A CSED

  1. A variety of laws affect CSEDs. A brief summary of some of the various case actions that can suspend and/or extend a CSED follows. This IRM provides a brief overview of some of these case actions; it is not all inclusive. The following sections are included to highlight relevant issues. Details pertaining to the specific subject matter should be further researched in the applicable IRM section, which in most cases will be cross-referenced.

  2. If more than one case action suspends the running of the collection statute, and the suspensions overlap, the CSED is viewed as extended only once for the period the suspensions overlap.


    Taxpayer Smith owes 1040 taxes for the period ending 12/31/1998. The tax assessment date is 06/01/1999 which established the original CSED as 06/01/2009. Smith is in the Army Reserves, he gets called up for combat duty and enters the combat zone on 05/10/2004. He subsequently leaves the combat zone on 03/01/2005. He submits an offer in compromise on 04/20/2005, it is rejected on 10/17/2005, and the rejection is not appealed.

    Both case actions, entering the combat zone and submitting the offer in compromise, suspend and extend the CSED. The combat zone duty suspends the CSED from 05/10/2004 through 03/01/2005 plus 180 days (through 08/28/2005). Consideration of the offer in compromise suspends the CSED from 04/20/2005 through 10/17/2005 plus an additional 30 days for the rejection appeal period to 11/16/2005.

    However, because these case actions overlap, the CSED will be suspended only from the date Smith enters the combat zone (TC 500 cc 56 on 05/10/2004) through the date the offer in compromise is rejected and the rejection appeal period ends (TC 481 on 11/16/2005). In this case the overlapping of the two case actions, from 04/20/2005 to 08/28/2005, is considered in the CSED extension only once.

    The CSED will be extended 555 days from the original CSED of 06/01/2009. The new CSED will be 12/08/2010.  (05-19-2016)

  1. The CSED, in a case under the Bankruptcy Code, is suspended while the Service is prohibited by reason of the case from collecting, and for six months thereafter. For more information see IRC 6503(h)(2). Thus, the CSED is generally suspended while the automatic stay imposed by the bankruptcy is in effect. Even if the suspension of the CSED under IRC 6503(h) no longer applies, the CSED 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, ASED/CSED.

  2. Check with Insolvency if there are any questions about the effect of bankruptcy, particularly multiple bankruptcies, on the CSED.  (07-19-2012)
Transaction Codes for Bankruptcy

  1. A TC 520/521 suspends a CSED by the amount of time beginning on the TC 520 (posted Cycle 8624 or later) transaction posting date, and ending on the associated TC 521 posting date, plus six months.

  2. A TC 520 with a closing code 60 through 67, 83, or 85 through 89 systemically suspends the CSED unless a TC 550 (new CSED) is posted with a later transaction date. For more information see IRM, Effect of Bankruptcy on the Limitation Period for Assessment and Collection.  (05-19-2016)

  1. Per IRC 6502(a), a court action 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.  (05-19-2016)
Transaction Codes for Judgment/Litigation

  1. TC 520 with closing code 70 through 75 and closing code 84 does not suspend the CSED.

  2. TC 520 with closing code 76 through 81 suspends the CSED, unless a TC 550 (new CSED) is posted with a later transaction date. See also IRM Exhibit 25.3.6-1, Closing Codes for Transaction Code 520, and IRM, TC 520 Closing Codes.  (05-19-2016)
Suit to Reduce Assessments to Judgment

  1. In order for a suit to reduce the assessments to judgment and suspend the collection period, it must be filed prior to the CSED. The filing of a suit will suspend the collection statute during litigation. For more information see IRM, Suit to Reduce Assessments to Judgment.

  2. When a judgment is entered in a case where assessments were reduced to judgment, request input of TC 550, definer code 04, using 20 years from the date the judgment was entered as the new CSED.


    The TC 550 definer code 04 must be input before the TC 520 is reversed. This will prevent the CSED from expiring if it falls during the pendency of the litigation.  (05-13-2005)
Collection Due Process (CDP)

  1. 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.

  2. 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.

  3. For more information see IRM, Suspension of Collection Statute of Limitations, and Treas. Reg. § 301.6330–1(g)(3), ex. 1.  (11-22-2013)
Offer In Compromise

  1. For offers pending prior to January 1, 2000, the CSED extension was affected 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 CSED for the period the offer in compromise was pending, while any installment of an accepted offer remained unpaid, and for one additional year thereafter.

  2. For offers pending prior to January 1, 2000, a waiver of the CSED cannot extend the CSED beyond either December 31, 2002, or the original CSED, whichever is later, pursuant to section 3461(c)(2) of the IRS Restructuring and Reform Act of 1998 (RRA 98).

  3. For offers pending on or made after December 31, 1999, suspensions of the running of the CSED in the offer in compromise context are governed by statute, specifically by IRC 6331(k)(1) and (3).

  4. Under these provisions, the Service is prohibited from levying, and the CSED is suspended

    1. While an offer is pending with the Service,

    2. For 30 days immediately following rejection of the offer, and

    3. 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 installment remains unpaid" and "for one additional year thereafter" are eliminated.

  5. The Community Renewal Tax Relief Act of 2000, effective December 21, 2000, amended IRC 6331(k)(3) and eliminated the suspension of the CSED while offers (and installment agreements) were pending.

  6. The Job Creation and Workers Assistance Act of 2002, effective March 9, 2002, amended IRC 6331(k)(3) and reinstated the CSED suspension with respect to both offers and installment agreements. With respect to offers, the CSED is again suspended for:

    1. The number of days the offer remains open from March 9, 2002,

    2. The number of days the offer is pending,

    3. Thirty days after rejection of the offer, and

    4. The period that a timely filed appeal of a rejection is being considered in Appeals.

  7. Cases may be encountered where prior rules were in effect. For more information see IRM, Effect of Previous Offers on Collection Statute.

  8. If only one party to a joint assessment files an OIC, then the CSED 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.

    • P = Primary

    • S = Secondary

    • B = Both  (10-16-2012)
Installment Agreements - Partial Payment Installment Agreements With Form 900, Tax Collection Waiver

  1. Form 900, Tax Collection Waiver, is only executed in connection with the granting a partial payment installment agreement and only in certain situations. See IRM, Waiver Procedures for Partial Payment Installment Agreements. IRS policy dictates that a Form 900 be limited to no more than five years, plus up to one year to account for changes in the agreement.


    Prior to July 2005, IRS policy permitted CSED extensions in conjunction with all installment agreements.

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

    • The time the proposed installment agreement is pending,

    • Thirty days following the rejection of a proposed installment agreement,

    • Thirty days following termination of an installment agreement, and,

    • Any appeal of the termination or rejection of the installment agreement.


      This change is not retroactive. The suspension of the running of the collection statute is during the time that a levy is prohibited. The CSED is not suspended while an installment agreement is in effect.

    For more information see IRC §§6159(a), 6331(k), 6502(a), IRM and c and IRM Exhibit 5.14.1-1, Input of Transaction Code 971 Action Code 043 and 063 for Pending and Active Installment Agreements.  (05-19-2016)
Relief From Joint And Several Liability On Joint Returns/Innocent Spouse

  1. Collection by levy or a proceeding in court against a spouse is suspended for the requesting spouse when he or she makes a qualifying request 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, Statute of Limitations on Collection.

  2. The collection period is suspended from the filing of the claim until the earlier of the date 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.

  3. 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 period during which any administrative hearings, and appeals therein, regarding the levy are pending. 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.

  4. 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.

  5. A request for reconsideration is not a qualified 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).  (06-04-2009)
Taxpayer Living Outside the U.S.

  1. 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) .

  2. 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.  (05-19-2016)
Policies For Adjusting the CSED When Internal Revenue Code (IRC) 6503(c) Applies

  1. These instructions are designed to promote procedural consistency in working International cases and to make statute suspension procedures, applying to Domestic and International taxpayers, more comparable. They apply to taxpayers who are presently abroad as well as to taxpayers who are currently in the U.S., but who were abroad for at least six consecutive months after the tax assessment date.

  2. The period that the CSED is recalculated and updated will be more limited with respect to taxpayers who have cooperated with IRS to resolve their liabilities or with whom we have maximized the IRS’s ability to collect.

  3. A taxpayer will be considered "cooperative" if the IRS determined that the taxpayer has fully responded to the IRS and has provided full information to the IRS with respect to collection of the assessment. In such instances, the case may be resolved by a taxpayer entering into a formal installment agreement or a valid offer in compromise or with the case being closed as currently-not-collectible for hardship reasons with closing codes 24 through 32.

  4. This policy does not apply to international taxpayers who have not resolved their liabilities and who are not cooperative. In those situations, where a taxpayer has been uncooperative or has not resolved the liability, the CSED will be recalculated and updated for the maximum amount of time allowed by IRC 6503(c) if the IRS determines that there is significant collection potential.

    1. With respect to taxpayers who are currently outside the United States, and who have systemically loaded or manually monitored installment agreements or periodic payment offers in compromise or periodic payment offers in compromise, for which the payment schedule is up to 24 months, the maximum length of CSED recalculation is 16 years from the date of assessment.

    2. Continuous levies for taxpayers with international addresses will be recalculated and updated for however many years the IRC 6503(c) provision allows if the taxpayers involved have not cooperated with IRS to resolve their liabilities.

    3. For taxpayers with significant collection potential that have been out of the United States for a lengthy period of time, recalculate the CSED as necessary for the time anticipated to collect the liability up to the maximum time allowed under IRC 6503(c). Assets located outside the United States can count as significant collection potential. Although assets located outside the jurisdiction of the United States cannot usually be levied or seized, other collection tools may be available to reach them. See IRM 5.21.3, Collection Tools for International Cases.


      Assets located in a country with which the U.S. has a mutual collection agreement may be seized or levied by the mutual collection country.

    4. International taxpayers who are being reported as currently-not-collectible with the following closing codes:
      • 03 (unable to locate),
      • 06 (International), or
      •12 (unable to contact)
      may be subject to ongoing recalculations and updates. Again, a determination of significant collection potential should be made when determining how long the collection statute should be recalculated.

    5. The collection statute should not be recalculated and updated for international taxpayers who have been reported as currently-not-collectible for hardship reasons (closing codes 24 through 32), except in rare instances where a mandatory follow-up date was set to determine if an asset had matured for collection potential.  (06-04-2009)
Reasons For Recalculating the CSED For IRC 6503(c)

  1. Reasons can be based on the following criterion (applied to the extent that the policies above allow):

    1. A Form 433A that the taxpayer or power of attorney has signed stating the dates of residence outside the United States and Commonwealth Territories.

    2. Any other written information from the taxpayer or power of attorney stating the taxpayer was outside the United States and Commonwealth Territories.

    3. Oral statements by the taxpayer or power of attorney stating the dates the taxpayer was outside the United States and Commonwealth Territories so long as this information is clearly documented in the case history.

    4. Tax returns consistently filed since the year of tax assessment with a foreign address (with recalculation and update of the CSED up to the date the taxpayer signed the return).

    5. When you are not able to use one of the methods above to determine and verify the period the CSED is to be suspended, check data sources such as Accurint, credit report, IRP, third party testimony, etc., to determine whether a taxpayer has been outside the United States for a long period of time. Such sources may be used in later taxpayer or POA discussions to confirm the dates foreign travel/residence; however, do not rely solely on these sources to justify updating the CSED.

  2. If you are ultimately unable to communicate with the taxpayer or POA, you may be able to confirm that the taxpayer has been outside the United States with a government-based travel or residency source of information such as TECS Historical Travel Records, see IRM, TECS Historical Travel Information, or Department of State records of registration with a U.S. Consulate in a foreign country. When a case has significant collection potential and the preponderance of information assembled at that point indicates being outside the U.S. for the time period in question, you can update the statute for that period.  (07-19-2012)
CSED Suspension for Partnerships with Addresses Outside the U.S.

  1. Per IRC 6503(c), the running of the collection statute is suspended for the period during which a taxpayer is outside the United States for a continuous period of at least six months. Per IRC 7701(a)(1) and (a)(14), the term "taxpayer" includes partnerships.

  2. For partnerships with an address outside the U.S. see the If/Then table below,

    If Then
    there is no other evidence that a taxpayer was in the U.S. for a continuous period of at least six months the taxpayer's use of an address outside the U.S. for that time is sufficient to establish they were outside the U.S. for such time.
    a partnership has an address outside the U.S. the CSED for partnership balance due accounts is suspended until the partnership returns to the U.S.
  3. Determining that a partnership,

    1. Is outside the U.S.,

    2. Has remained in the U.S., or

    3. Has returned to the U.S.

    may be more difficult for a partnership than an individual. Consult with Counsel to be sure you have sufficient evidence before recalculating a partnership's CSED.

  4. Be prepared to discuss with Counsel the following,

    1. Does the partnership own property within the U.S.?

    2. Was the partnership formed or registered within a state?

    3. Does the partnership have a resident agent?

    4. Does the managing partner (general partner) reside in the U.S.?

    5. Do the majority of partners reside in the U.S.?

    6. Does the partnership earn a substantial amount of its income from activities within the U.S.?


    It may not be beneficial to recalculate a partnership's CSED if there is no collection potential.

  5. Only the partnership outside the U.S. has the CSED suspended under IRC 6503(c).

    If And Then
    the partnership has an address outside the U.S. one or more of the partners are in the U.S. the CSED for the partnership taxes is still suspended under IRC 6503(c).
    the partners owe individual taxes the partners live in the U.S. the CSED for the partner's individual taxes is not suspended under IRC 6503(c)  (05-19-2016)
Procedures For Adjusting the CSED for International Taxpayers (IRC 6503)

  1. Use Form 8620, Statute Recalculation, to request CSED updates based on the criteria established above. Because IRC 6503(c) automatically suspends the statute, there is no reason for the taxpayer to sign Form 8620.

  2. Forms 8620 should be sent via secured e-mail to Centralized Case Processing (CCP) the campus address to which input requests are sent.


    Statute recalculations and updates for IRC 6503(c) must have managerial approval on Form 8620 or on ICS.

  3. Form 8620 is not required for Bal Due modules active in ICS. IRC 6503(c) CSED updates can be made, with managerial approval, via ICS.

  4. Document the case history with the following:

    1. The sources checked to verify that the taxpayer resided outside of the United States, and

    2. The steps followed to calculate the new CSED.  (05-19-2016)
Combat Zone or Contingency Operation

  1. Under IRC 7508, the deadline for certain acts performed by taxpayers and the Service is postponed when the taxpayer serves as follows in:

    1. An area designated as a combat zone;

    2. A contingency operation designated by the Department of Defense;

    3. A qualified hazardous duty area as defined by Congress; or

    4. Direct support of military operations in a combat zone certified by the Department of Defense.

  2. The acts specified in IRC 7508 include paying :

    • Income tax

    • Estate tax

    • Gift tax

    • Employment tax

    • Excise tax, and

    • Collecting any tax.

    Rev. Proc. 2007–56, or its successor, expands the list provided in the statute.

  3. A deadline is postponed while the taxpayer serves in the area or operation and for any period of continuous qualified 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. The deadline is also extended by an additional 105 days (106 in a leap year) depending on the entry and exit dates for combat zone service in that filing season. For more information see IRM, Accounts of Taxpayers Who Serve in a Combat Zone.


    Per IRC 7508(e)(3) the collection statutory period is not extended (even if a deadline is postponed) during any period of continuous qualified hospitalization as a result of injury received while serving in the combat zone or contingency operation and the following 180 days. There are also exceptions for tax in jeopardy, cases under title 11 of the USC (bankruptcy), and transferred assets.

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

    • Processing of a tax return where the taxpayer has written "Serving in Desert Storm/Shield, Bosnia, former Yugoslavia, Allied Force, Afghanistan, or Enduring Freedom."

    • Manual input of Transaction Code 500 with Closing Code 52 for the Desert Storm Combat Zone, Closing Code 54 for Bosnia/Former Yugoslavia or Allied Force, or Closing Code 56 for Afghanistan or Iraqi/Enduring Freedom. For more information see IRM, Combat Zone Freeze Codes.

  5. 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.

  6. Research IMFOLI for the Combat Indicator on line 11.

    If Then
    Combat indicator is "1" the taxpayer is still serving in a combat zone and collecting or assessing tax is prohibited.
    Combat indicator is "2" the taxpayer is no longer a combat zone participant, proceed with the collection investigation.


    There may be occasions when a taxpayer in an active combat zone either wishes to make a payment or wants to have a return assessed (for example to obtain EITC). Process the return or payment and advise the taxpayer that the collection and assessment statutes will continue to be suspended  (02-15-2005)
Military Deferment

  1. Under the Servicemembers Civil Relief Act (cited as 50 USC. App. 570) 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.

  2. Transaction Code 500 with Closing Code 51 suspends the CSED for a Military Deferment. For more information see IRM, Military Deferment Procedures.  (02-15-2005)
Wrongful Levy (Seizure)

  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. Definer code 08 is used with TC 550.

  2. 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, Wrongful Seizure - Payment of Claims After Sale.  (02-15-2005)
Wrongful Lien

  1. 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. Definer code 08 is used with TC 550.

  2. 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.  (07-19-2012)
Estate Tax Lien

  1. Taxes assessed on Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return, are allowed various special elections under the Internal Revenue Code that allow for deferral of payment of estate taxes due. Under IRM 6503(d), the CSED is suspended for the period of any extension of time for payment that is granted. See also IRM, Collection Statute Expiration Date.

  2. Generally there are two Code sections 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.

  3. IRC 6166 generally allows for a 5-year deferral and annual installment payments over a 10-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, Collecting Estate and Gift Tax Accounts, provides additional information on collection of estate tax accounts and the CSED.

  4. IRC 6161 allows an extension to pay estate taxes for up to 12 month increments for a maximum of 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, Processing Estate and Gift Tax Extensions, provides additional information on IRC 6161 accounts and the CSED.

  5. 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.

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

  7. 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.  (07-19-2012)
Taxpayer Assistance Order (TAO)

  1. 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), the statute of limitations on collection and/or assessment may be extended for a certain period.

  2. Due to systemic 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, Taxpayer Advocate Case Procedures, Introduction to Suspension of the Statutes of Limitation Under IRC§ 7811(d).  (02-15-2005)
Enforcement Of The Two-Tier Tax Scheme

  1. 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, Enforcement of the Two-Tier Tax Scheme, for complete details.  (01-01-2006)
Substitute for Return

  1. 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.

  2. 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.

  3. 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.  (11-22-2013)
CSED Payment Application

  1. Apply payments to the bal due module with the most imminent CSED first. This includes proceeds from seizures, levies, installment agreements and other undesignated voluntary payments.


    The CSED reflected on IDRS or ICS may not be correct due to simultaneous actions suspending or extending the CSED.


    A module for a later period may have a more imminent CSED than the CSED for earlier periods. Apply the payment to the period with the earliest CSED on an assessed liability.

  2. Do not solicit voluntary payments on accounts barred by statute. If a taxpayer makes a payment on an account barred by statute, inform them that the payment is not required and ask if they wish to make the payment or have it returned to them. The taxpayer must be advised that the payment is purely voluntary and will be treated as a gift to the U.S. Treasury. If the taxpayer's intentions cannot be ascertained, return the payment to the taxpayer.

  3. Proceeds from the sale of assets seized prior to the expiration of the statute can be applied after the date of expiration. The affected modules require that Transaction Code (TC) 520 Closing Code (cc) 80 be input. Any outstanding balance will be closed using TC 530 cc 05 after the application of sale proceeds and after the statute expires.

  4. Proceeds received as a result of a levy that was served prior to the CSED may be applied to the expired module(s).


    In some instances penalties may have a different CSED apart from any other assessment on the module.  (05-19-2016)
Imminent CSEDs

  1. An imminent CSED is any CSED with 12 months or less remaining on the collection statute.

  2. When there is an imminent CSED concurrent with another issue, such as erroneous case assignment, it may be appropriate to request shelving. Consult with your group manager.


    Managers should see IRM, Shelving Erroneously Assigned Cases.

  3. With situation specific guidance from Headquarters, managers may close imminent statute cases or modules issued to their hold files with less than six months on the CSED by routing certain cases or modules to an ICS/Entity Quality Analyst (IQA) for CNC closing. This temporary limited use of the Transaction Code 530 with Closing Code 39, requires Headquarters guidance. When such guidance is issued, it will list the case criteria and specific actions required and will be referred to in the ICS case history by the group manager.


    Imminent CSED modules intended for an ACS project are inadvertently routed to GM hold files.


    A system conversion leads to the erroneous assignment of imminent CSED cases to GM hold files.


    Programming errors result in the assignment of low risk imminent CSED cases to GM hold files.

  4. Field Collection managers and employees are responsible for verifying that imminent CSEDs are correct.

  5. Failure to properly identify and appropriately work imminent CSED accounts can result in an unnecessary loss of revenue to the government.

  6. Field Collection employees must work imminent CSEDs timely as priority cases.  (02-15-2005)
Monitoring Imminent CSEDs

  1. You are responsible for monitoring any imminent CSEDs in cases assigned to you. Some of the various ways to do this are:

    • ENTITY queries

    • ICS generated reports

    • ICS Case Summary screens display the earliest CSED for the case

    • ICS generates notifications at pre-set intervals prior to CSED expirations, starting one year prior to expiration  (02-15-2005)
Working Imminent CSEDs

  1. 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.

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

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

  4. 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.

  5. 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, Currently Not Collectible.  (09-07-2007)
Documenting Imminent CSEDs

  1. Upon receipt of an imminent CSED module, or when CSED(s) become imminent, discuss with your group manager 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 case is received with 120 days or less left on the CSED, immediately make an immediate appointment with your group manager to discuss the case as an ad hoc CC.

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

  3. 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 be printed and included in the case file.  (02-15-2005)
Expiration Of A Collection Statute

  1. If all appropriate case actions have been taken 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.

  2. 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.

  3. 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.  (05-19-2016)
Expiration of the Collection Statute for Fewer Than All Assessments

  1. When the CSED has expired for an assessment but not all assessments, request input of TC 534, Expired Balance Write-off, for the assessed amount(s) related to the expired CSED. Select the ICS template Form 3870- Other Assessment Request to CCP (Philadelphia). The module will adjust for the expired assessment resulting in an accurate balance due computation. See also IRM, Master File Partial Statute Expiration.  (11-22-2013)
Collection Statutes That Expire Without Prior Approval

  1. If a collection statute expired without the group manager's prior concurrence or due to inappropriate case actions, enter a statement in the case history addressing the reasons why the statute expired. The statement should include any unusual or mitigating circumstances.

  2. 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.

  3. The territory manager will review the memo and determine if it should be forwarded to the area director for recommended potential disciplinary action.

  4. If the collection statute expires on a Bal Due, non-field other investigation (NFOI), or any other open module in the control of another function, e.g., Area Counsel, Appeals, etc., then advise the manager and document the circumstances of the expiration in the case history.  (11-22-2013)
Removing Expired Statute Modules From Inventory

  1. 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.


    The TC 608 can post up to two cycles prior to the actual statute expiration date.

  2. 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, Statute Expiration.

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