On Friday, August 29th, Lake Henry Estates received good news from the United States Internal Revenue Service, as follows:
“We received the amended tax return and payment you submitted in the amount of $13,449. However, the law provides a limited period of time for us to charge and collect additional tax. This legal period has expired for the tax period December 31, 2014. For this reason, we will not assess tax for the additional income you reported after the expiration date. We’ll return your payment to you in a separate letter.”
Background: In 2014 Lake Henry Estates purchased a foreclosed house in Lake Henry Estates, volunteers made repairs to it and it was sold for a profit. Information concerning income and expenses were provided to our accountant who transposed the numbers when preparing our taxes. This lead to the under-reporting of income for the year 2014. On May 22, 2020 Lake Henry Estates amended the 2014 Federal tax return and paid the additional taxes of $13,449.
Per the IRS website, the time limitation for collecting owed taxes is typically 6 years. These returned funds will improve Lake Henry Estates’ financial position as we approach the last quarter of 2021!