Would my brother-in-law who has not lived in the United States for 25 years be eligible for Social Security if he owes back taxes with a tax judgment pending against him?

by Christopher R. Cicalese, CPA, MSTFP | Jun 03, 2019

askacpaiconMy brother-in-law has not lived in the United States for 25 years. When he left, he had not filed any income tax returns for several years and owed back taxes. I do not know if any judgments were filed in his case. Is there a statute of limitations for back taxes owed, and would he still be eligible for Social Security if he had a tax judgement pending against him?

The statute of limitations for tax returns is generally three years after the original return is filed. If no return is filed, the statute of limitations never starts, and it would carry on indefinitely until a return is filed. If the government can prove fraud by clear and convincing evidence, the statute of limitations is unlimited. An omission of 25 percent of gross income has an increased statute of six years. Taxpayers with tax problems can still collect Social Security, but the Taxpayer Relief Act of 1997 authorizes the IRS to claim up to 15 percent of each payment until the tax debt is paid. There are some payments that are excluded from a tax levy, such as disability payments.

You may want to consider contacting a CPA or attorney for further assistance.

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Answered by: Christopher R. Cicalese, CPA, MSTFP, is a manager at Alloy Silverstein Shapiro Adams Mulford Cicalese Wilson & Co. in Cherry Hill, N.J.

The responses are based on the limited information provided by the questioner and apply the laws and regulations at the time of posting. Other options could arise as rules and regulations may change over time, including but not limited to the passage of the Tax Cuts and Jobs Act of 2017. They are intended to provide general information, not specific accounting or tax advice; they are not intended or written to be used and cannot be used for the purpose of avoiding or evading taxes or penalties under the IRS code or regulations. Views expressed do not imply an opinion of the PICPA, its officers, directors, employees, or members.
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