Section 316-24-261 - EXAMINATION FOR MATHEMATICAL OR CLERICAL ERRORS AND DEFICIENCIES261.01Department Power to Examine Returns. The Department may examine any income tax return, the related federal return, any supporting schedules and worksheets, and other information to determine the correct amount of income tax liability or the correct amount of credit or loss to be carried over. The Department may adjust the amounts the taxpayer reported as federal taxable income, deductions, credit calculations, or any other item, so that the amounts reported are consistent with the IRC and Nebraska law. If the calculated amount of Nebraska income tax liability or the amount of credit or loss to be carried over is incorrect for any reason, the Department will correct the amount and notify the taxpayer.261.02Mathematical of Clerical Errors. The Department may correct mathematical errors made on the return and notify the taxpayer. A notice that additional Nebraska income tax is due because of a mathematical error is not a notice of deficiency determination and there is no right to protest or appeal the correction. Mathematical or clerical error includes information on the taxpayer's return that is different from information reported to the Internal Revenue Service or the Tax Commissioner, for example, information reported on a federal Form W-2 or Form 1099.261.03Deficiencies.261.03A If the amount of tax liability shown on any income tax return is less than the correct amount or the amount of credit or loss to be carried over is incorrect, for any reason other than a mathematical error, the Department will issue a notice of deficiency determination to the taxpayer.261.03B If the taxpayer fails to file a return, the Department will estimate the taxpayer's income tax liability or income based on the best information available and issue a notice of deficiency determination to the taxpayer or its owners.261.04Statute of Limitations.261.04A The Department may issue a notice of deficiency determination within three years after the original due date for the return, or the date the return is filed, whichever is later.261.04B If the taxpayer omits an amount which is in excess of 25% of the Nebraska taxable income of the taxpayer, or improperly omits a member of the unitary group, the Department may issue a notice of deficiency determination within six years after the date the return was filed.261.04C If the taxpayer files an amended return to report a change as required by Neb. Rev. Stat. § 77-2775, the statute of limitations provided in Reg-24-255 or Reg-24-258 applies.261.04D If a return has not been filed, or a false and fraudulent return is filed, the Department may issue a notice of deficiency determination at any time.261.04E If a taxpayer fails to file an amended return or report a change as required by Neb. Rev. Stat. § 77-2775, the Department may issue a notice of deficiency determination at any time.261.05Using Tax Preparers. Taxpayers are responsible for the accuracy of any information contained on any return, schedule, or worksheet that affects the calculation of income tax liability or any credit. Using a tax preparer does not relieve any taxpayer of responsibility to accurately report and satisfy any income tax liability.316 Neb. Admin. Code, ch. 24, § 261
Adopted effective 7/5/2020