Yes, there are always exceptions. But were we talking about large companies? See more:
Just for your interest, here is the text of what the IRS had to say about Congress ending their infinite collection time:
IRS Restructuring and Reform Act of 1998 - Section 3461 - Procedures for Extension of Statute of Limitations by Agreement
Section 3461
A. Provision(s) covered: R.R.A. § 3461. Procedures Relating to Extensions of Statute of Limitations By Agreement. I.R.C. § § 6501(c) and 6502(a).
B. Background: Section 6501 of the Internal Revenue Code generally provides that the Service has three years from the date a return is filed to assess additional taxes. Section 6502 generally provides that the Service has ten years from the date of assessment to collect the tax. Prior to the expiration of the limitations period provided by these provisions, the law provided that the taxpayer and the Service could agree in writing to extend the statute of limitations. Congress believed that many taxpayers were not being informed of their rights to refuse to extend the statute of limitations on assessment or to limit the scope of any such extension. In addition, Congress believed that all taxes should be collected within the 10 year statute and that the statute should not be extended.
C. Change(s): The authority to extend the collection statute of limitations by agreement ends on December 31, 1999. Any extension of the collection statute already in effect on December 31, 1999, will expire on December 31, 2002. An exception to this section is provided for extensions related to installment agreements. An extension of the collection statute entered into in conjunction with the acceptance of an installment agreement should be for the period necessary to satisfy the tax liability via the agreement. The legislation provides that the period of limitations for extensions related to installment agreements will expire 90 days after the end of the extension period.
The legislation also requires that taxpayers be advised/notified of their right to refuse to extend the statute of limitations on assessment or in the alternative to limit an extension on the assessment statute to particular issues or for specific periods of time, each time that the Service requests that the taxpayer extend the limitations period.
D. Impact: Because the Service will have to complete collection actions within the 10 year statute in most cases, collection contacts and actions will have to be initiated sooner. Although this is true in general, it is especially true for cases where the collection statute will expire within the next 2 years and for cases where the original collection statute has been extended beyond December 31, 2002.
These cases will have to be identified and managed appropriately. Since all current extensions other than those related to installment agreements will expire on December 31, 2002, the Service will have to take steps to release liens associated with these liabilities, as the liens become unenforceable. Although the statute of limitations for collection can be extended for installment agreements, the statutory waiver must be entered into at the time the installment agreement is accepted and must be for a determined period, i.e., for the period necessary to satisfy the tax liability via the agreement. The period of limitations will end on the 90th day after the end of the waiver period.
Examination personnel will have to provide notice to a taxpayer of his/her right to refuse to extend the statute of limitations on assessment or to limit the scope and time of the extension each time such an extension is requested. Whether the taxpayer is advised orally or in written form, the giving of the notice must be documented in the taxpayer's file, each time a request for extension is sought.
In general, the IRS can bug you about your tax return for only three years after you file it. But there are exceptions.
IRS spokesman Jesse Weller points out that the agency can reach back as many as six years if it suspects you omitted a substantial amount of income from a return filed during that period. The amount of income omitted would have to equal at least 25 percent of the amount you actually reported
Furthermore, if you failed to file a return, or if the IRS suspects you filed a fraudulent return, no statute of limitations applies.
Weller notes that once the agency has determined that you owe money, it has 10 years to try and collect. It is possible that the IRS made such a determination in your friend's case early
Steve Morgan
C.J. Segerstrom & Sons, Records Manager
[log in to unmask]
714.438.3228 Phone
714.546.9835 Fax
-----Original Message-----
From: Records Management Program [mailto:[log in to unmask]] On Behalf Of Christian Meinke
Sent: Tuesday, August 15, 2006 8:25 AM
To: [log in to unmask]
Subject: Re: Retention of time sheets
Normally this is true, but if you are a large company or otherwise under scrutiny of the IRS, the IRS can "negotiate" a much longer time period in which to audit your records. Our IRS audit process has extended as much as
14 years - so do check with your tax department to see what, if any special arrangements you may already have with the IRS.
Christian Meinke, CRM
Southern California Edison
Information Management
PAX 20483
(626) 302-0483
[log in to unmask]
Records Management Program <[log in to unmask]> wrote on 08/15/2006
07:45:02 AM:
> Actually, I have some info on IRS limits & it states:
>
> The IRS has 3 years to audit your tax return or to assess any
> additional tax liabilities.
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List archives at http://lists.ufl.edu/archives/recmgmt-l.html
Contact [log in to unmask] for assistance
List archives at http://lists.ufl.edu/archives/recmgmt-l.html
Contact [log in to unmask] for assistance
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