About Taxes: 3 Important Time Limits for Taxes
 | from William Perez
Every so often I come across a tax situation where I know the answer, but cannot find the law behind it. This happened this past Friday and I spent several hours tracking this one down. Taxpayers have three years, three months, and 15 days to report self-employment earnings and still get credit towards future Social Security benefits. I had remembered the three year part, but finding this one was tough, and so I decided to pass along the information to you.
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3-Year Limit for Social Security Credits
Every one needs to earn at least 40 "credits" to be eligible for Social Security retirement benefits. For most people, their earnings are reported annually using Form W-2. But for self-employed people, they need to report their earnings by sending in a tax return. And if the tax return is more than three years late, they can lose out on having their earnings count towards their Social Security.
| | 3-Year Limit on Tax Refunds and Audits
There's another 3-year time limit. Taxpayers have three years (from the original filing deadline) to file a return and claim a refund. Similarly, the IRS has three years (from the date you filed a return) to initiate an audit. Together with the 3-year, 3-month, 15-day limit for Social Security, this makes it important to file a late return before these deadlines expire.
| 10-Year Limit to Collect Tax Debts
Once you file a return, the IRS has ten years to collect any balance due you owe, plus penalties and interest. Ten years is a long time to wait for the IRS to stop their collection efforts. Fortunately, there are five ways to handle owing the IRS, and so a solution can always be found to keep the IRS from being overly aggressive.
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