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By virtue of the above-described waivers (Forms SS-10) and
Offer in Compromise (Form 656), respondent’s issuance of the
notice of determination on May 24, 1999, occurred before the
expiration of the period of limitations on assessment of
petitioner’s employment taxes for periods ending in 1994 and
1995. Accordingly, the statute of limitations does not bar
assessment of employment taxes for those periods.
Petitioner contends that the abatement on May 3, 1999, of
the employment tax assessment (see Background, supra, section G.)
served to annul the waiver provisions of the Offer in Compromise.
We disagree. Petitioner in fact executed Form 656 and thereby
agreed to the suspension of the period of limitations with
respect to the employment taxes that were subject to the offer.7
B. 1996
The regular 3-year period of limitations for assessment of
employment taxes reportable on Form 941; i.e., FICA taxes, for
the calendar quarters ended March 31, June 30, September 30, and
December 31, 1996, expired on April 15, 2000. The regular 3-year
7 At trial, petitioner introduced a document dated June 13,
2000, purporting to withdraw the Offer in Compromise previously
submitted in Dec. 1998. In petitioner’s view, withdrawal of the
offer would serve to negate the waiver of the statute of
limitations therein. However, petitioner may not, by such simple
expedient, eliminate the consequences of its action in submitting
the offer. More precisely, paragraph (m) of the offer
specifically states that the offer remains pending “until an
authorized IRS official * * * acknowledges withdrawal of the
offer in writing.”
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