Yang, a calendar year taxpayer, did not file a tax return for 2007 because she honestly believed that no additional tax was due. In 2016, Yang is audited by the IRS and the agent assesses a deficiency of $17,000 for 2007. Yang need not pay this deficiency, since the three-year statute of limitations expired on April 15, 2011, meaning that the IRS no longer can adjust Yang's tax for the 2007 tax year.

Question

Quizplus · Accepted Answer

The statute of limitations for the IRS to assess a deficiency is generally three years, but if no return is filed, the statute of limitations does not begin, allowing the IRS to assess the deficiency at any time.

Yang, a Calendar Year Taxpayer, Did Not File a Tax