So what happens when the collection statute expires? When the collection statute expires, the IRS can no longer collect on the balance due. As a result, the IRS will write-off the balance due. However, taxpayers beware, if your case is in collections, the IRS can get very aggressive in attempting to collect the tax debt before time runs out.
The IRS can assign a Revenue Officer to the case. A Revenue Officer’s primary job function is to collect on the outstanding tax debt. The Revenue Officer will request a Collection Information Statement, Form 433A, along with supporting documentation to determine the taxpayer’s ability to back the back taxes. Depending on what the financial information shows, the IRS can request that the taxpayer liquidate their assets. The Revenue Officer will try to collect as much as he or she can within a short period of time, if possible.