P-3 Examination and Appeals Flashcards
What is IRS form 872?
IRS form 872 is the consent to extend the time to assess tax, this form must be signed by the taxpayer and the revenue agent.
What form must be filed to request a prompt assessment from the IRS of tax liability due for a corporation?
Form 4810 (Request for prompt assessment under the IRC section 6501(d)) is required to be filed and the assessment and collection process must be completed within 18 months of the date the form is filed.
What must the IRS do when contacting third parties in regard to a tax assessment?
The IRS must provide the taxpayer with a general notice before making inquiries.
When does the repeat examination rules apply to taxpayer?
The repeat examination rule applies when the taxpayer gets audited for the same items in either of two preceding years, had no change proposed on his tax liability, and receives notice that his return has been selected for examination.
When does the IRS have to stop collecting or levying any tax assessed on a taxpayer?
The IRS cannot collect or levy any tax ten years after the date of assessment of tax or levy.
What are three instances where the IRS does not have to provide a reasonable notice when contacting third parties?
The IRS does not have to provide notice when there is a pending criminal investigation, the taxpayer already has authorized contact or providing the notice might result in reprisal against the contact.
By law, the IRS has the authority to collect outstanding Federal taxes for 10 years beginning on what date?
By law, the IRS has the authority to collect outstanding Federal taxes beginning from the date of assessment. This is called the (Collections Statute Expiration date).
The IRS has three years to assess a taxpayers tax liability, on what date the three years begin?
The IRS has three years from the due date of the return or the date actually filed (whichever is later) to assess any additional taxes that may be owed.
The statutory notice of deficiency is also known as? and why?
The 90-day letter because the taxpayer generally has 90 days from the due date of the letter to file a petition with the Tax Court.
What is a tax shelter?
Any entity, plan, or arrangement with a significant purpose of which is the avoidance or evasion of income tax.
What are the steps in the examination process?
- The examination - In home, at workplace or at IRS office
- The 30-day letter - notifying of right to appeal the proposed changes within 30-days.
If no response is made by TP or if no agreement is made with an appeals officer or IRS then, - The 90-day letter - Notice of deficiency giving 90-day period to file a petition with the tax court.
