City Wide Transit, Inc. v. Comm’r of Internal Revenue

The Commissioner appealed from the tax court's order that prevented the Commissioner from collecting City Wide's outstanding employment taxes for seven taxable quarters. The tax court held that the Commissioner was time barred from collecting these taxes under section 6501(a) of the Internal Revenue Code and that the tolling provisions under section 6501(c)(1) and (2) of the I.R.C. did not apply. The court held that an accountant who filed fraudulent tax returns on behalf of a company in order to embezzle money otherwise owed to the Commissioner intentionally evaded taxes, thereby triggering the tolling provision under section 6501(c)(1). Accordingly, the court held that the Commissioner could assess City Wide's taxes for those seven quarters at any time. View "City Wide Transit, Inc. v. Comm'r of Internal Revenue" on Justia Law