Friday, March 1, 2013
Failure to File Statute of Limitations Commences on Failure to File by Extended Due Date (3/1/13)
In United States v. Lyerly, 20132 U.S. Dist. LEXIS 20743 (SD AL 2013) [link to come], Judge Proctor, in a well-reasoned opinion, held that the statute of limitations for criminal failure to file when the taxpayer filed for an automatic extension to 10/15 but then failed to file by 10/15 begins to run on 10/15, the last day the taxpayer could have filed. The taxpayer argued that, his failure to file by 10/15 meant that the extension was invalid and thus the return was due 4/15; hence, his failure to file by 10/15 started the criminal statute of limitations under Section 6531.
The Court noted, in essence, that the statute cannot begin running until the crime is committed. The taxpayer could not be prosecuted for failure to file until 10/15 had come and gone without filing.
I had not included this nuance in the Federal Tax Crimes book. I have added this to the ongoing draft and it will be included in the next version of the book.