Debbie,a calendar year taxpayer,did not file a tax return for 2004 because she honestly believed that no additional tax was due.In 2010,Debbie is audited by the IRS and the agent assesses a deficiency of $7,000 for tax year 2004.Debbie need not pay this deficiency,since the statute of limitations expired on April 15,2008.

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The statute of limitations for the IRS to assess a deficiency for a tax year is generally three years from the date the tax return was due or filed, whichever is later. In this case, the tax return was not filed, so the statute of limitations does not begin to run until the due date (April 15, 2005) has passed. Therefore, the statute of limitations would expire on April 15, 2008 + three years, which is April 15, 2011. Thus, Debbie may still have to pay the deficiency assessed by the IRS agent.

Debbie,a Calendar Year Taxpayer,did Not File a Tax Return for 2004