TC 560: Assessment Statute Extended by Consent

What the code actually does

TC 560 extends the Assessment Statute Expiration Date to a specified new date — typically after the taxpayer signs Form 872, Consent to Extend the Time to Assess Tax. The ASED is the deadline by which the IRS must formally assess additional tax; once it passes without an assessment, the IRS permanently loses the ability to bill more for that period, absent a specific exception (fraud, a substantial omission of income, or no return filed at all).

IRM 25.6.22.5.2, Preparation of Consents, documents the consent process itself in depth: "[t]he consent must be prepared in duplicate. A duplicate original signed by both the taxpayer... and delegated IRS official is sent to the taxpayer." Separately, IRM 25.6.22.3, Notification of Taxpayer’s Rights, confirms Form 872 itself "set[s] out" the taxpayer’s rights "in the ‘Your Rights as a Taxpayer’ section" of the form.

Why the ASED/CSED distinction matters more than the form itself

The single most important thing to know about a Form 872 is what it does not do: it never extends the CSED — the Collection Statute Expiration Date, the deadline to collect tax that is already assessed. Advising a client that signing a Form 872 buys the IRS more time to collect an existing balance is simply wrong — that is a separate consent, TC 550 — IRM 5.1.19.2.3, TC 550 Waiver Extension Definer Codes, governs it, not the 25.6 series: "[a] TC 550 extends a CSED to the date input with this transaction," most often under definer code 01, Form 900 — a separate signature from Form 872. Run the CSED Calculator on the already-billed liability separately from the Form 872 conversation; a client with an already-billed liability and a client facing a pending assessment on a different, open tax year are in two different postures, and a TC 560 speaks only to the second one. The rule worth saying out loud to a client: Form 872 buys the IRS more time to bill, never more time to collect.

The mechanics — and one specific unposting condition

IRM 25.6.1.9.16, the subsection governing changes to the ASED within the broader statute-of-limitations manual, confirms a specific interaction worth knowing: "TC 560 will unpost if the module contains an unreversed TC 480" — meaning if that tax period’s own module (the IRS’s record for that period within the account) already carries a pending Offer in Compromise. The two mechanisms extend the same statute through entirely different processes, and the system will not let a TC 560 post cleanly on top of an active TC 480; the OIC pendency rules already extend the ASED on their own terms.

Signing is the taxpayer’s decision, not the practitioner’s

A Form 872 gives the IRS more time to find and bill additional tax, with no guaranteed benefit to the taxpayer in return. Signing it is the client’s own choice to make, not a call the practitioner makes on their behalf, and the taxpayer has an unqualified right to decline. Before signing anything on a client’s behalf, confirm the specific Form 2848 on file actually grants that authority for this account — a general power of attorney does not automatically cover every act, and some clients restrict it deliberately. Declining to sign has a real consequence of its own — it forces the IRS to assess based on the return as filed, or issue a notice of deficiency, before the original ASED runs, rather than buying the examiner more time.

The practitioner’s job is to explain that trade-off clearly enough for the client to actually decide — more time for the examiner to expand the audit’s scope, against no guaranteed benefit to the client — not to sign reflexively to avoid a rushed audit closing before the original deadline. Document that explanation in writing — a dated file memo or email summarizing the trade-off and the client’s decision protects both the client’s record and the practitioner’s own file if anyone questions the decision later. Once the client has decided, verify the TC 560 date against the actual signed consent, confirm the extension matches what the client actually agreed to (some consents restrict themselves to specific issues), and track the new date independently rather than trusting the transcript alone.

What TC 560 gets confused with

TC 560 and TC 550 are the pair practitioners mix up most, precisely because practitioners colloquially call both of them "statute waivers." TC 560 extends the ASED — the assessment deadline, via Form 872. TC 550 extends the CSED — the collection deadline, on tax already assessed, via a different consent process entirely. A client asking "did I just give the IRS more time to collect what I owe?" needs to know which of these two codes is actually on their transcript, because the answer is genuinely different depending on which one it is.

TC 560 is also worth distinguishing from a TC 480 pending Offer in Compromise — which resolves as TC 481 if rejected or TC 482 if withdrawn or terminated — and which extends the ASED through an entirely separate mechanism while it is pending; see the unposting rule above. A module should not carry an active TC 560 stacked on top of an unreversed TC 480 for the same reason: the IRS already has an ASED extension in place through the offer’s own pendency rules.