On March 30, 2005 Miguel Foods, Inc. received a notice of assessment and a letter of demand on its April 15, 2002 final adjustment return from the…

The question

On March 30, 2005 Miguel Foods, Inc. received a notice of assessment and a letter of demand on its April 15, 2002 final adjustment return from the BIR. Miguel Foods then filed a request for reinvestigation together with the requisite supporting documents on April 25, 2005. On June 2, 2005, the BIR issued a final assessment reducing the amount of the tax demanded. Since Miguel Foods was satisfied with the reduction, it did not do anything anymore. On April 15, 2010 the BIR garnished the corporation's bank deposits to answer for the tax liability. Was the BIR action proper? (2011 Bar Question)

1. A.Yes. The BIR has 5 years from the filing of the protest within which to collect.
2. B.Yes. The BIR has 5 years from the issuance of the final assessment within which to collect.
3. C.No. The taxpayer did not apply for a compromise.
4. D.No. Without the taxpayer’s prior authority, the BIR action violated the Bank Deposit Secrecy Law.

This question has not been answered yet.