The statute of limitations (“SOL”) for the State of Ohio’s right to collect tax liabilities administered by the Ohio Department of Taxation recently expired for many older tax claims. Effective September 28, 2006, O.R.C. §131.02 was amended to impose an SOL on tax claims. Under the SOL, the State may not commence an “initial action” to collect taxes, interest or penalties after the later of: (i) seven (7) years after the date an assessment is issued; or (ii) four (4) years after the date an assessment becomes final. This period is extended for any period during which collection is stayed. An assessment is considered “final” upon the expiration of the period to petition for reassessment or, if applicable, to appeal a final determination of the commissioner, the board of tax appeals, or a court. Collection action includes commencement of an action by the Attorney General’s office in aid of execution of judgment. The 2006 amendment included a three-year suspension provision which pushed back the effective date of the amendment and the SOL expiration date to September 28, 2009 for those liabilities and assessments which otherwise would have expired prior to such date. Accordingly, as of September 28, 2009, the State is prohibited from initiating collection action on many older tax claims.
If you have any questions about Ohio’s tax collection SOL, please contact attorney Mario J. Fazio at 216-831-0042, ext. 139, or by e-mail at email@example.com.