8.7 Statute of Limitations

The time period to collect taxes is extended by the filing of a bankruptcy that does not discharge all of the taxes. The balance on the 10-year statute of limitations is extended by the length of the bankruptcy plus 6 months.1  If the taxpayer is close to the 10-year statute of limitation on federal tax liability, this factor should be considered when deciding the timing of filing a bankruptcy.

• 1I.R.C. § 6503(h).