422.54  Failure to file return--incorrect return.

1.  As soon as practicable after a return is filed and in any event within five years after the return is filed, the department shall examine it, assess and determine the tax due if the return is found to be incorrect, and give notice to the taxpayer of the assessment and determination as provided in subsection 2. The period for the examination and determination of the correct amount of tax is unlimited in the case of a false or fraudulent return made with the intent to evade tax or in the case of a failure to file a return.

2.  If a return required by this division is not filed, or if a return when filed is incorrect or insufficient and the maker fails to file a corrected or sufficient return within twenty days after the same is required by notice from the department, the department shall determine the amount of tax due from information as the department may be able to obtain and, if necessary, may estimate the tax on the basis of external indices, such as number of employees of the person concerned, rentals paid by the person, stock on hand, or other factors. The department shall give notice of the determination to the person liable for the tax. The determination shall fix the tax unless the person against whom it is assessed shall, within sixty days after the giving of notice of the determination, apply to the director for a hearing or unless the taxpayer contests the determination by paying the tax, interest, and penalty and timely filing a claim for refund. At the hearing evidence may be offered to support the determination or to prove that it is incorrect. After the hearing the director shall give notice of the decision to the person liable for the tax.

3.  The five-year period of limitation provided in subsection 1 may be extended by a taxpayer by signing a waiver agreement form to be provided by the department. The agreement shall stipulate the period of extension and the tax period to which the extension applies. The agreement shall also provide that a claim for refund may be filed by the taxpayer at any time during the period of extension.

Section History: Early form

  [C35, § 6943-f49; C39, § 6943.085; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, § 422.54]

Section History: Recent form

  87 Acts, ch 199, § 8; 92 Acts, 2nd Ex, ch 1001, § 243; 94 Acts, ch 1133, §7, 16

Internal References

  Referred to in § 421.10, 422.47, 422.52, 422A.1, 422B.9, 422C.4, 423.16, 455B.455


  1994 amendments to subsections 1 and 2 are effective for notices of assessment issued on or after January 1, 1995; 94 Acts, ch 1133, §16

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