Rev. Rul. 81-269

ISSUE

When will the period of limitation for assessment of tax expire in the following situations?

FACTS

Situation 1. A, an individual taxpayer, files his or her federal income tax return on a calendar year basis. A filed the return for 1978 with the Internal Revenue Service on March 1, 1979.

Situation 2. B, an individual taxpayer, also files on a calendar year basis. B filed the return for 1978 on Monday, April 16, 1979.

LAW AND ANALYSIS

Section 6072(a) of the Internal Revenue Code provides that individual income tax returns made on the basis of the calendar year must be filed on or before April 15 of the following year.

Section 6501(a) of the Code provides the general rule that tax must be assessed within 3 years after the return was filed.

Section 6501(b)(1) of the Code provides that, for purposes of section 6501, a return filed before the last day prescribed by the Code or regulations is considered as filed on the last day.

Section 7503 of the Code provides that when the last day for performing any act falls on a Saturday, Sunday, or legal holiday, performance of the act is considered timely if it is performed on the next day that is not a Saturday, Sunday, or legal holiday.

The purpose of section 7503 of the Code is to extend the time for filing a document when the last day for filing is a Saturday, Sunday, or legal holiday. Section 7503 does not change the date prescribed for performing an act, nor does it provide that an act performed on the day following a Saturday, Sunday, or legal holiday will be deemed to have been performed on the actual due date. Rev. Rul. 75-344, 1975-2 C.B. 487.

In Situation 1, section 7503 of the Code does not operate to change the "date prescribed for filing" to April 16. Accordingly, because an early return is deemed filed on the date prescribed for filing the return, which remains April 15, 1979, the period of limitations under section 6501(a) starts running from April 15.

In Situation 2, while the return filed on April 16 is considered timely filed under section 7503 of the Code, it is not deemed to have been filed on April 15. In this case, the period of limitations under section 6501(a) starts running from the actual date of filing, or April 16. See Brown v. United States, 391 F.2d 653 (Ct. Cl., 1968).

HOLDINGS

Situation 1. The period of limitation for assessment of tax (or mailing of the notice of deficiency) will expire April 15, 1982.

Situation 2. The period of limitation for assessment of tax (or mailing of the notice of deficiency) will expire April 16, 1982.

If the expiration date were to fall on a Saturday, Sunday, or legal holiday, section 7503 of the Code would operate to extend that period to the next day that is not a Saturday, Sunday, or legal holiday.