Tricky Rules For Amending Tax Returns
By Amending returns can cause clients and practitioners needless anxiety if they do not fully understand the applicable rules. This short article describes those rules regardless of whether the amended return provides an addition to tax or requests a refund.
The first concern is the statute of limitations. Section 6501(a) generally provides a three-year statute for the IRS to assess additional tax. Therefore, the IRS generally has three years to initiate and conclude an audit. Although certain circumstances (substantial omissions of income and fraud) can increase this limitations period to six years or indefinitely, for simplicity this article assumes the statute is three years. The three-year period runs from either the due date (generally April 15th of the year following the tax year in question) or the date actually filed (if filed after the due date). Returns filed after the due date include returns filed on extension. One might think filing an amended return automatically starts over the three-year period, but that is not the case. Instead, the IRS is still generally bound by the original three-year period based on the filing of the original return.
Chuck Kitchen, former chair of the NCBA Constitutional Rights and Responsibilities Section and NCBA member Karlene Turrentine have formed a new law firm, Kitchen & Turrentine, PLLC. Located in Raleigh, the firm will serve clients throughout the state. The new firm will concentrate on local government, business, and employment matters, and general civil litigation. More information can be found on their website at ktlawnc.com.
Corena Norris-McCluney has returned to Kilpatrick Townsend & Stockton as special counsel, concentrating in labor and employment litigation. She previously served as senior vice president, general counsel, for Krispy Kreme Doughnut Corp. She holds an undergraduate degree from North Carolina State University and a Juris Doctorate from Wake Forest University.
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