- 7 - ministerial act the same binding effect as a considered judgment would make little sense as a practical matter. Respondent’s ultimate rejection of petitioners’ amended return for 1985 was entirely proper. The ability of a taxpayer to amend his return creates administrative problems for a tax system in which determination and assessment of taxes are predicated on the annual accounting principle. Pacific Natl. Co. v. Welch, 304 U.S. 191, 194 (1938); Bartlett v. Delaney, 173 F.2d 535 (1st Cir. 1949). Allowing the taxpayer to use the benefit of hindsight to select the most favorable set of intertemporal tax consequences for his transactions would be highly prejudicial to the revenue. Melahn v. Commissioner, supra at 776-777. Accordingly, the case law recognizes limits on the effectiveness of amended returns, generally. Koch v. Alexander, 561 F.2d 1115, (...continued) of 150 days after the FPAA is mailed to the tax matters partner. Sec. 6225. A “deficiency” for purposes of sec. 6225 means the excess of tax due over the amount shown on the original return plus any additional amount shown as tax on an amended return, “other than amounts of additional tax which such return clearly indicates the taxpayer is protesting rather than admitting.” Sec. 301.6211-1(a), Proced. & Admin. Regs. Treatment of the investment credits had been a matter of controversy during the audit of Ethanol and was the subject of adjustments in the FPAA. On their amended returns for 1985 and 1986 petitioners explained that their purpose in seeking to revoke the credit was merely to stop the interest charges, not to concede liability. Consequently, it appears that the assessed amounts should have been treated as part of the deficiency attributable to a partnership item. See Powerstein v. Commissioner, 99 T.C. 466 (1992). Yet respondent assessed these amounts only 125 days after issuing the FPAA. If respondent’s assessments with respect to the amended returns exceeded the scope of her authority, the argument that these assessments validated petitioners’ amended returns becomes all the more dubious.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
Last modified: May 25, 2011