When it comes to consent forms for extending the statute of limitations for time to assess tax there are three basic types, the fixed period consent, the open ended consent, and the restricted consent.
Form 872 (Consent to Extend the Time to Assess Tax) is used to extend the statute of limitations on assessment to a specific future date. This form is used in most situations and is considered the most basic form for extending the statute of limitations on the time to assess tax.
Form 872-A (Special Consent to Extend the Time to Assess Tax) is used as an open ended consent form. It is used in situations where the statute of limitations needs to be indefinitely extended. There are only three ways that a valid Form 872-A can be terminated:
1. The taxpayer mails in Form 872-Tn to the IRS. The Form must be mailed to the IRS, no exceptions.
2. The IRS mails Form 872-T to the taxpayer.
3. The IRS issues a Notice of Deficiency to the taxpayer.
If any one of these events occurs, the statute of limitations is extended for 90 days on assessment of tax. However, if Form 872-A is terminated by a Notice of Deficiency, the statute of limitations will expire “60 days after the period during which the making of an assessment is prohibited”.
Form 872-T (Notice of Termination of Special Consent to Extend the Time to Assess Tax) is used by the taxpayer or IRS to terminate the valid Form 872-A that is currently in use.
Form 872-B (Consent to Extend the Time to Assess Miscellaneous Excise Taxes) is used to extend a special date for the IRS to assess excise tax.