Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 465.1543


465.1543 Statute of Limitations. A taxpayer underpays the taxes due for one or more periods. Subsequently, the taxpayer discovers the error and corrects it by overpaying the tax due in following periods. An audit is performed, but the statutory limitation periods include the period of overpayment, but not the period of under payment. The taxpayer wishes to offset the overpayments against deficiencies noted in the periods under audit.

No offset is permissible. When a limitation period prevents collection activities by a creditor, it does not prevent a debtor from making payments against an overdue but acknowledged debt. Where an overpayment in one period is clearly payment for an amount due in an earlier period which has become barred by the statute of limitations, the overpayment may be properly applied to the underpayment for such periods. There is no requirement that such payments be applied to underpayments for subsequent periods under audit. 8/5/94.