The petitioner's return was under audit and IRS sought the petitioner's signature on Form 872 to extend the normal three-year statute of limitations for assessment of additional tax to allow IRS more time to complete the audit. However, Form 872 contained the wrong tax year and the petitioner argued that the statute of limitations had not been extended and, thus, IRS couldn't assess additional tax because the statute of limitations had run. The court disagreed, noting that both the petitioner and the IRS believed that the Form 872 actually applied to the tax year being audited. Thus, the parties had made a mutual mistake and the court allowed the Form 872 to be reformed such that it was applicable to the tax year under audit. Hartland Management Services, Inc. v. Comr., T.C. Memo. 2015-8.
Court Allows Statute of Limitations To Be Extended Even Though Form 872 Erroneous.
Date of decision:
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