KRS 136.550 — Examination and audit of tax returns -- Assessment of excess

(1) As soon as practicable after each return is received, the department shall examine
and audit it. If the amount of tax computed by the department is greater than the
amount returned by the financial institution, the excess shall be assessed by the
department within four (4) years from the date prescribed by law for the filing of a
return including an extension of time for filing, except as provided in this
subsection. A notice of the assessment shall be mailed to the financial institution.
(a) In the case of a failure to file a return or of a fraudulent return, the excess may
be assessed at any time.
(b) In the case of a return wherein a financial institution understates its net capital
or omits from net capital an amount properly includible therein or both, which
understatement or omission or both is in excess of twenty -five percent (25%)
of the amount of net capital stated in the return, the excess may be assessed at
any time within six (6) years after the return was filed.
(2) For the purpose of subsection (1) of this section, a return filed before the last day
prescribed by law for the filing shall be considered as filed on the last day. The
times provided for in subsection (1) of this section may be extended by agreement
between the financial institution and the department.