Extended Limitations Circuit Split Creates Uncertainty

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Although recent rulings that create a split among the federal circuits on whether an overstatement of basis triggers tax code Section 6501(e)(1)(A)'s extended limitations period addressed tax shelter transactions, attorneys tell BNA the rulings raise issues that could affect a large number of tax practitioners. “Some tax practitioners may be quick to lump these rulings with the growing number of Son of BOSS decisions and conclude that they have limited application,” Anthony Daddino says in an e-mail to BNA. “They would be grossly mistaken. These decisions involve such fundamental principles as stare decisis and separation of powers. They will define the judiciary's role in interpreting the tax laws and its check on the IRS' rule-making authority for years to come.”