The Usual Three-Year Statute of Limitations on Additional Tax Assessments

question 72

Multiple Choice

The usual three-year statute of limitations on additional tax assessments applies in the following situation(s) .

• A) No return at all is filed.
• B) An investment in a marketable security is worthless.
• C) Taxpayer discovers an inadvertent overstatement of deductions equal to 30% of gross income.
• D) Taxpayer inadvertently omits an amount of gross income equal to 30% of the gross income stated on the return.

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Definitions:

Implied Condition

A condition that is not specifically and explicitly stated but is inferred from the nature and language of the contract.

Completion

The finalization or conclusion of a project, contract, or process, marking the end of work and the beginning of the operational period.

Bedroom

A room within a dwelling intended for sleeping or resting, typically containing a bed and storage furniture.

Substantial

Of considerable importance, size, or worth; significant.