The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws. The statute of limitation applies to the taxpayer would end on.

Question

Want to see more full solutions like this?

Answer 1

Question

100%

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Indicate the date that the statute of limitations would run out on each of the following 2018 individual tax returns: a. A fraudulent tax return that was filed April 15, 2019 ________________ b. A tax return that was filed May 19, 2019 ________________ c. A tax return that was filed February 12, 2019 ________________ d. A tax return that was filed March 1, 2019, and omitted $15,000 in income. The total gross income shown on the tax return was $50,000 ________________

Norman Foster filed his 2021 income tax return as was required on June 15, 2022. His Notice of Assessment dated August 28, 2022, indicated that his 2021 income tax return was accepted as filed. On March 15, 2023, he receives a Notice of Reassessment dated March 8, 2023 indicating that he owes additional income tax, as well as interest on the unpaid amounts. What is the latest date for filing a notice of objection for this reassessment? Explain your answer.

The following data pertain to a taxpayer’s request for refund:Date tax erroneously paid, January 2, 2020Petition for request for refund filed, January 10, 2020Documents supporting the request for refund submitted, January 22, 2020.The Commissioner of Internal Revenue has not acted on the request. When is the last day to appeal to the Court of Tax Appeals?

Answer 2

Question

100%

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

100%

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

100%

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Question

100%

Answer 6

Question

100%

Answer 7

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Answer 8

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

Answer 9

Chapter 12, Problem 8P

a.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

Answer 10

a.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to April 15, 2023.

Answer 11

a.

Expert Solution

Answer 12

a.

Expert Solution

Answer 13

Expert Solution

Answer 14

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on April 15, 2020, fraudulently. In this case, the statute of limitation applies to the taxpayer up to April 15, 2023.

Therefore, the statute of limitation applies to the taxpayer up to April 15, 2023.

Answer 15

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

Answer 16

b.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

Answer 17

b.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to May 19, 2023.

Answer 18

b.

Expert Solution

Answer 19

b.

Expert Solution

Answer 20

Expert Solution

Answer 21

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on May 19, 2020. In this case, the statute of limitation applies to the taxpayer up to May 19, 2023.

Therefore, the statute of limitation applies to the taxpayer up to May 19, 2023.

Answer 22

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

Answer 23

c.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

Answer 24

c.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to February 12, 2023.

Answer 25

c.

Expert Solution

Answer 26

c.

Expert Solution

Answer 27

Expert Solution

Answer 28

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on February 12, 2020. In this case, the statute of limitation applies to the taxpayer up to February 12, 2023.

Therefore, the statute of limitation applies to the taxpayer up to February 12, 2023.

Answer 29

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Answer 30

d.

To determine

Introduction: The Internal Revenue Service (IRS) has a wide range of functions and responsibilities such as look after of administration of federal taxes, and to perform duties like estimating, determining, and collecting taxes in the form of revenue to the government, it also performs tax return audits and imposes penal provisions. It is the office within the revenue department. The task of the department is to provide the taxpayers with quality service by assisting them in proving knowledge content so the taxpayers understand their tax responsibility and pay taxes timely. It is important in maintaining and establishing tax laws.

The statute of limitation applies to the taxpayer would end on.

Answer 31

d.

Expert Solution

Answer to Problem 8P

The statute of limitation applies to the taxpayer up to March 01, 2026.

Answer 32

d.

Expert Solution

Answer 33

d.

Expert Solution

Answer 34

Expert Solution

Answer 35

Explanation of Solution

The statute limitation is the gap between a return filing date and a date to modify its return for a refund claim or for charging additional taxes from the taxpayer by the IRS. In practice, it is 3 years of the filing date of a tax return, without considering any extensions or 2 years from the deposition of taxes by the taxpayer. Tax laws provide for certain exceptions to this provision as under:

In case the return is not filed or the return is filed fraudulently, this provision does not apply. IRS will collect any tax deficiency later without any time limit.
In case a taxpayer forgoes an amount exceeding 25 percent of the shown gross income in the tax return, then the time limit will become 6 years.
For bad-debt deduction and valueless securities deduction, the time limit will increase to 7 years.

Also on mutual agreement taxpayer and IRS may decide any extended date for this provision and this extension can only be sought if the date of this provision is close to expiring and the audit is yet to complete. When IRS finds any tax deficiency it may collect this amount in 10 years from the assessment date.

In the given situation, the 2018 individual tax return was filed on March 01, 2020, omitting $15,000 income and shown $50,000 gross income in the tax return. In this case, the statute of limitation applies to the taxpayer up to March 01, 2026, that is 6 years as the omitted amount is over 25 percent of the gross income shown.

Therefore, the statute of limitation applies to the taxpayer up to March 01, 2026.

Answer 36

Ch. 12 - Which of the following is a responsibility of a...Ch. 12 - Prob. 2MCQ Ch. 12 - Prob. 3MCQ Ch. 12 - Prob. 4MCQ Ch. 12 - Prob. 5MCQ Ch. 12 - Prob. 6MCQ Ch. 12 - Prob. 7MCQ Ch. 12 - Prob. 8MCQ Ch. 12 - Prob. 9MCQ Ch. 12 - Prob. 10MCQ

Concept explainers

Answer to Problem 8P

Explanation of Solution

Answer to Problem 8P

Explanation of Solution

Answer to Problem 8P

Explanation of Solution

Answer to Problem 8P

Explanation of Solution

Want to see more full solutions like this?

Chapter 12 Solutions