- 25 -
with false returns. Petitioner is correct that section
6501(c)(1) provides an unlimited assessment period in the case of
a taxpayer who files a false or fraudulent return with intent to
evade tax. The definition of fraud for purposes of section
6501(c)(1) is the same as the definition of fraud for purposes of
section 6663 (which imposes a penalty for fraud). See, e.g.,
Chin v. Commissioner, T.C. Memo. 1994-54 (with respect to the
predecessor to section 6663); Williamson v. Commissioner, T.C.
Memo. 1993-246 (same); Richman v. Commissioner, T.C. Memo. 1993-
32 (same); Callahan v. Commissioner, T.C. Memo. 1992-132 (same).
The elements of fraud are: (1) That the taxpayer has underpaid
his taxes for each year, and (2) that some part of the
underpayment is due to fraud. See DiLeo v. Commissioner, 96 T.C.
858, 873 (1991), affd. 959 F.2d 16 (2d Cir. 1992); Parks v.
Commissioner, 94 T.C. 654, 660-661 (1990); Truesdell v.
Commissioner, 89 T.C. 1280, 1301 (1987); Hebrank v. Commissioner,
81 T.C. 640, 642 (1983).
Section 6501(c)(1) applies to any taxpayer who files a false
or fraudulent return with intent to evade tax. When a taxpayer
files such a return, “�6501(c)(1) would permit the Commissioner
(...continued)
(1) False return.--In the case of a false or
fraudulent return with the intent to evade tax, the tax
may be assessed, or a proceeding in court for
collection of such tax may be begun without assessment,
at any time.
Page: Previous 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 NextLast modified: May 25, 2011