Texas Administrative Code
Title 34 - PUBLIC FINANCE
Part 1 - COMPTROLLER OF PUBLIC ACCOUNTS
Chapter 3 - TAX ADMINISTRATION
Subchapter O - STATE AND LOCAL SALES AND USE TAXES
Section 3.339 - Statute of Limitations

Universal Citation: 34 TX Admin Code § 3.339

Current through Reg. 50, No. 13; March 28, 2025

(a) Assessments.

(1) Except as otherwise provided in this section, the comptroller has four years from the date a tax becomes due and payable to assess a deficiency tax liability. For information as to when a tax becomes due and payable, see § 3.286 of this title (relating to Seller's and Purchaser's Responsibilities, including Nexus, Permits, Returns and Reporting Periods, Collection and Exemption Rules, and Criminal Penalties).

(2) The statute of limitations does not apply and the comptroller may assess and collect taxes, penalties, and interest at any time against a taxpayer if:
(A) the taxpayer files a false or fraudulent sales tax return with the intent to evade the tax;

(B) the taxpayer fails to file a sales tax return; or

(C) the taxpayer files a sales tax return that has a gross error. A gross error exists when the amount of tax due and payable, after the correction of error, exceeds the amount of tax reported on the return by at least 25%.

(3) The statute of limitations does not apply to any period for which a taxpayer has filed a timely claim for a sales tax refund if, while investigating the merits of the refund claim, the comptroller determines that additional tax is due. The assessment for the additional tax determined to be due for that period must be made within four years from the date the claim for refund was filed.

(b) Extension of limitations period. Before the expiration of the statute of limitations, the comptroller and a taxpayer may agree in writing to extend the limitation period in accordance with Tax Code, § 111.203. An extension applies only to the periods specifically mentioned in the agreement and no single extension agreement may be for a period that exceeds 24 months from the date of the expiration of the period being extended. Any assessment or refund request pertaining to periods for which limitations have been extended must be made prior to the expiration date of the agreement. Following expiration of the agreement, the statute of limitations applies to subsequent assessments and refund requests as if no extension had been authorized.

(c) Tolling of limitations. In computing the expiration date of a limitation period, the following periods are not considered:

(1) the period following the date of the protest payment to the date of the timely filed lawsuit in district court suspends the statute of limitations for the same contested issues raised;

(2) the period during which a judicial proceeding involving a protest suit is pending suspends the statute of limitations for the same contested issues raised;

(3) the period during which an administrative redetermination or refund hearing is pending suspends the statute of limitations for the same contested issues raised; and

(4) the period during which a bankruptcy proceeding commenced under United States Code, Title 11 is pending suspends the statute of limitations.

(d) Refunds. For information on the statute of limitations for refunds, see § 3.325(b) of this title (relating to Refunds and Payments Under Protest).

(e) Successor liability. The comptroller may assess tax against the successor of a business if, at the time the business or stock of goods was acquired, the seller of the business had an outstanding sales tax liability with the state. The assessment must be made within four years from the date of the sale of the business to the successor or from the date a determination against the seller becomes final, whichever event occurs later. For information on successor liability, see § 3.7 of this title (relating to Successor Liability: Liability Incurred by Purchase of a Business).

(f) Suit for collection. Within three years from the date that a deficiency or jeopardy determination becomes due and payable, or within three years after the last recording of a lien, the comptroller may file suit for collection of the taxes, penalties and interest. If a redetermination hearing is requested, the determination will not become final until a redetermination decision is issued and becomes final.

(g) Notice of delinquency. Within three years from the date that a deficiency determination becomes due and payable, a jeopardy determination becomes final, the last recording of a lien, or a redetermination decision becomes final, the comptroller may give notice of delinquency to all persons who have in their possession or under their control any credits or other personal property belonging to the delinquent, or who owe any debts to the delinquent.

(h) Seizure. Within three years from the date that a deficiency determination becomes due and payable, a jeopardy determination becomes final, or a redetermination decision becomes final, the comptroller may seize any property of the delinquent and sell the property, or a sufficient part of it, at public auction to pay the taxes, penalties, and interest due.

(i) Remedies cumulative. The remedies of the state are cumulative and no action taken by the comptroller or the attorney general constitutes an election by the state to pursue any remedy to the exclusion of any other remedy for which provision is made.

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