US statute of limitations on non-filed tax returns -

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We have our US answer.  It  adds something I did not know.  That
is that paying the tax late in the US extends the deadline.
Thanks Don
David
-----Original Message-----
From: Don Keith [mailto:[email protected]]
Sent: Thursday, July 24, 2003 11:29 AM
To: [email protected]
Subject: US statute of limitations on non-filed tax returns
David,
Your e-mail requested a response from the US on the US statute of
limitations.  The answer is actually quite straight forward.
For a filed return, the statute normally closes (a) three years
from the filing due date, April 15, or (2) the date actually
filed if later than April 15.  If payments are being made beyond
the dates indicated above, two years from the date of the final
payment.
If the government can prove fraud, the statute never closes.  An
understatement of income by 25% or more is considered fraud.
For a non-filed return, the statute stays open forever.
I have seen non-filer cases were returns were not filed for 15,
20, 25 years.  I have usually been able to "cut" an agreement
with the IRS Agent assigned to the case (there is always an Agent
assigned) to accept ten years and close the case.  When records
have not been available, reasonable estimations have been
acceptable.
Remember, an IRS agent or collections officer is supposed to
generate $1,000 per hour for their time.  They are not supposed
to chase chase insignificant dollars.
Don Keith, CPA    Great Falls, Montana
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