“Hello and welcome to Sherayzen Law Office video blog. My name is Eugene Sherayzen; I’m an international tax attorney and owner of Sherayzen Law Office, Ltd.
Today, I would like to discuss with you an interesting and very important concept in US Tax Law: Statute of Limitations. The Statute of Limitations basically means that there is a certain period of time when the IRS can go back and open up a certain tax form or an entire tax return for examination. The general Statute of Limitation under US Tax Law for a normal 1040 is three years; however, there are a number of important exceptions. One of the exceptions for example is when you do not disclose more than 25% of your income on your US Tax Returns. In this case, the Statute of Limitations extends to six years.
Now if you also fail to file an international information return with your US Tax Return, then you may be facing a situation where the Statute of Limitations never starts to run. In other words, the IRS can go back in time and open up that form forever, potentially forever. I have had in my personal practice situations where during an audit and IRS would go back 18, 20 years to open up a tax return for examination and imposition of penalties.
US Tax Law is filled with concepts like this, complex concepts, and it’s important to understand them before you make your decision on how to proceed with respect to the reporting of your foreign assets and foreign income.
If you would like to know more about US Tax Law or you would like to have a consultation, with respect to a specific international tax issue, you should contact me directly at: (952) 500-8159 or email me at: [email protected].
Thank you for watching until the next time.