Amendments to the Revenue Act (1941 PA 122)
On Thursday, January 30, 2014, the Governor signed what is now Public Act 3 of 2014. (2014 PA 3) The legislation amended the Revenue Act making monumental changes effecting the administration of Michigan taxes. Changes were made to the time limit to complete an audit and to issue a final assessment, successor liability, officer liability which is now responsible person liability, statute of limitations and refund of tax overpayments.
This is the third of five Blogs discussing 2014 PA 3 with changes noted in red.
Statute of Limitations
(2) A deficiency, interest, or penalty shall not be assessed after the expiration of 4 years after the date set for the filing of the required return or after the date the return was filed, whichever is later. The taxpayer shall not claim a refund of any amount paid to the department after the expiration of 4 years after the date set for the filing of the original return. A person who has failed to file a return is liable for all taxes due for the entire period for which the person would be subject to the taxes. If a person subject to tax fraudulently conceals any liability for the tax or a part of the tax, or fails to notify the department of any alteration in or modification of federal tax liability, the department, within 2 years after discovery of the fraud or the failure to notify, shall assess the tax with penalties and interest as provided by this act, computed from the date on which the tax liability originally accrued. The tax, penalties, and interest are due and payable after notice and hearing as provided by this act.
(3) The statute of limitations shall be extended for the following if the period exceeds that described in subsection (2):
(a) The period pending a final determination of tax through audit, conference, hearing, and litigation of liability for federal income tax and for 1 year after that period.
(b) The period for which the taxpayer and the state treasurer have consented to in writing that the period be extended.
(c) The period described in section 21(6) and (7) or pending the completion of an appeal of a final assessment.
(d) A period of 90 days after a decision and order from an informal conference, or a court order that finally resolves an appeal of a decision of the department in a case in which a final assessment was not issued prior to appeal.
(4) The statute of limitations is extended only as to those items that were the subject of the audit, conference, hearing, or litigation for federal income tax or a tax administered by the department. As used in this subsection, “items that were the subject of the audit” means items that share a common characteristic that were examined by an auditor even if there was no adjustment to the tax as a result of the examination. Items that share a common characteristic include items that are reported on the same line on a tax return or items that are grouped by ledger, account, or record or by class or type of asset, liability, income, or expense.
2014 PA 3 will be discussed in depth at the Michigan Sales and Use Tax seminars scheduled for Livonia and Traverse City.
Register on line at the MACPA website
Michigan Sales and Use Tax (30677 - MSUTLV)
Friday, June 20, 2014
VisTaTech Center Schoolcraft College - Livonia, MI
Michigan Sales and Use Tax (30681 - MSUTTC)
Tuesday, June 24, 2014
Holiday Inn Traverse City - West Bay - Traverse City, MI - Northern