IRS SUBSTITUTE FOR RETURNS AND TAX PAID - Spidell

IRS SUBSTITUTE FOR RETURNS AND TAX PAID

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Message Board IRS SUBSTITUTE FOR RETURNS AND TAX PAID

  • This topic has 7 replies, 4 voices, and was last updated 1 week, 1 day ago by David Ellis.
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    • #266168
      Anonymous
      Member

      My client is elderly and did not file tax returns for 2016 and 2017.  The IRS created Substitutes for Returns for both years and sent notices requesting payment of the tax due calculated on these returns.  Client paid the taxes per the notices in August, 2019.

      I recently received the documents for each year and have prepared returns…the tax paid according to the SFRs is significantly higher than actual tax owed.

      If the returns are filed now, is the taxpayer able to collect refunds of the amounts over paid?

    • #266169
      Lynn Freer
      Participant

      The statute of limitations is the later of 3 years from the due date of the return or 1 year from the date of payment. So it looks like if you file the returns right away you should be within the statute

    • #266210
      Anonymous

      Thank you.  Should the amount previously paid be included on the tax returns submitted to request the refund?

    • #266214
      Lynn Freer
      Participant

      yes

    • #266277
      Mark Bole
      Participant

      I’m not sure what is technically correct, but I would prepare (and have done so) 1040X returns here, using the SFR reported amounts as the original return.  This should make it far easier for the IRS to understand, including  having a dedicated line for showing prior tax payments made.
      You will need to get a transcript of the SFR numbers to do this.

    • #266704
      David Ellis
      Participant

      Pretty sure the statute of limitations is 3 years from the original due date of the return….or 2 years from the date the tax is paid….whichever is later.

    • #266705
      Lynn Freer
      Participant

      <div contenteditable=”true”>
      <div>Thanks David, here’s the cite. I was thinking of California, which is 4 years and 1 year.</div>
      <div></div>
      <div>Under Code Sec. 6511, for all taxes for which a return must be filed, a claim or refund must be filed within: (1) three years of the time the return was filed, except, if the return was filed before it was due, then the claim must be filed within three years of the return’s due date; (ii) two years from the time the tax was paid, if that period ends later; or, (iii) two years from the time the tax was paid, if no return’s filed by a taxpayer required to file a return</div>
      </div>

    • #266868
      David Ellis
      Participant

      Thanks Lynn.

       

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