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Section 6501(a) provides: “Except as otherwise provided in
this section, the amount of any tax imposed by this title shall
be assessed within 3 years after the return was filed (whether or
not such return was filed on or after the date prescribed)”.
(Emphasis added.) Section 6501(a) thus provides a 3-year period
of limitations on the assessment of tax running from the date
when a return was filed--it does not provide a period of
limitations within which a notice of deficiency must be issued.
Because petitioner did not file a return, respondent may issue a
notice of deficiency at any time and the period of limitations on
assessment remains open indefinitely. See sec. 6501(c)(3).
Petitioner’s argument has no merit.
C. Petitioner’s Federal Income Tax Deficiency
Respondent determined that petitioner had unreported income
of $1,138,436 in 1996, and a corresponding Federal income tax
deficiency of $459,500. Petitioner asserts that because
respondent failed to produce sufficient evidence of petitioner’s
receipt of taxable income, the notice of deficiency is not
entitled to a presumption of correctness. Therefore, petitioner
argues, respondent bears the burden of proof with respect to the
unreported income at issue. In making this argument, petitioner
ignores his own admission.
The Court of Appeals for the Ninth Circuit, to which an
appeal of this case would lie, has held that the Commissioner’s
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Last modified: May 25, 2011