Question

Explain whether the filling of returns in the following situations begins the statue of limitations on assessment: a. Joe Johnson files his return in a timely manner, but does not sign it. B. Mary Apple files an amended return approximately one year after she filed her original return. Tommy Gunn Files a partnership return in a timely manner. His organization is later held to be a corporation. Elliot Shaft files his individual tax return on April 20

Answer 1

Hey there !!

Let me help you with this question, Here we need to identify whether statute of limitations is applicable in the given cases.

Before that let me tell you what statute of limitations mean:

Generally, the statute of limitations for the IRS is to assess taxes and penalties no later than 3 years after either a tax return is filed or the return’s due date, whichever is later.

Now we have to explain whether the filling of returns in the following situations begins the statue of limitations on assessment.

a. Joe Johnson files his return in a timely manner, but does not sign it.

As per IRS, Non signing of return is equivalent to non filing of return. This return irrespective of whether submitted on time or not will be considered as invalid since the same is not signed. Hence, this statute of limitation on assessment of 3 years will not be applicable.

B. Mary Apple files an amended return approximately one year after she filed her original return.

In this case, return is amended one year after the original return was submitted. This is acceptable as per IRS rules. An amended return can be filed within three years after filing the original return, or within two years after payment of any tax due from that return—whichever is later.

So statute of Limitation on assessment of 3 yrs will be applicable.

C. Tommy Gunn Files a partnership return in a timely manner. His organization is later held to be a corporation.

He needs to file an amended return within the time limit suggested by the IRS. After which statute of limitation will be applicable from the date of filing amended return. If he doesn't amend within time limit, the same will not be applicable.

D. Elliot Shaft files his individual tax return on April 20

The IRS may penalize taxpayers for filing tax returns late. The statute of limitations begins on the date the tax return was due, i.e., April 15. If an individual files an extension for a Form 1040 and, subsequently, does not file a tax return, the statute of limitations begins on October 15, the date to which an extension to file was granted.

I hope the above solution is clear to you now, Do let me kniw in case of any concerns,.

All the best !!

happy studying :)