Tax Fraud Assessment Deadline Case Meets Skeptical Appeals Panel

Third Circuit judges were skeptical of a taxpayer’s arguments Wednesday that the IRS ran out of time to assess additional taxes when, without her knowledge, her return preparer had committed fraud in the 1990s.

The IRS has a three-year deadline to audit a tax return and make assessments, but that deadline is suspended when the return is false or fraudulent with the intent to evade tax. Stephanie Murrin appealed the Tax Court’s decision to apply that deadline exception to her case since it was her former return preparer—not Murrin herself—who had committed the fraud.

Murrin contests nearly $78,400 in tax ...