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7/27/2012 12:56:41 PM
 
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Section 5: OPA Board Subject: IRS Beach Parking Matter Msg# 838040
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Perhaps the only people who could explain fully are the Baltimore tax lawyers.
Fraud has to be intentional to avoid paying taxes. No one has suggested OPA did that over the years of the dispute. Found this on the web: "Another rule with the IRS that can fall under that Statute of Limitations is that if the IRS does not assess taxes within a three year period of the tax return being filed, they cannot legally collect those taxes that you would have owed. This is extremely rare that an agent misses the Statute of Limitations in a case like this, but errors are sometimes made and a taxpayer can get away with not paying a penny of whatever the tax amount owed was." To my knowledge only the 2003-2004 fiscal years were ever audited and actually assessed by IRS. OPA lost the legal challenge, is now writing off a total of $459,000 as the total tax obligation at this point (less the $119,000 already paid in order to go forward with the appeal). Are some upset that it wasn't more, and now wish to argue it should be more? |
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For reference, the above message is a reply to a message where: Joe, That is good news. The multi-year appeals process has resulted in several of the years since FY 2004 no longer being subject to taxes because the period for assessing a federal or state deficiency has expired under the statute of limitations. This is the reason the ultimately determined Estimated Liability and recorded expense are substantially less than the amount of potential exposure previously communicated. Can anyone explain this to me chronologically? I'm not positive, but I believe the IRS can challange a mathamatical error for three years, a filing error for seven years and fraud forever. I'm having difficulty equating the statue of limitations to our specific situation. The Estimated Liability has been determined to be $340,000 at April 30, 2012 for federal and Maryland taxes and interest. This amount, combined with the approximately $119,000 previously paid for federal taxes and interest for FY 2003 and FY 2004, results in an expense of $459,000, which will be recorded in the audited FY 2012 financial statements. Is this OPA's opinion or has the IRS accepted this? Norm Norm |
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