Some pencil pusher with a droll sense of humor must have made that change in the list of rules. Nobody’s yet spelled out any legal definition of “fraudulent” in this context, but I wouldn’t be surprised if it means something like an understatement of taxable income that the IRS believes was not an inadvertent mistake. Then, even if it’s been decades, the IRS can have you hauled into court to prove you did your tax return correctly after all, or at least that the incorrect return was an inadvertent mistake.
I keep returns and documentation all the way back to when I first filed them.
I am a lawyer and I have actually litigated against the IRS in court.
The definition of "fraud" in tax law is, in essence, deliberately underpaying a tax you actually know that you owe. The courts have developed a list of "badges of fraud" that they will look at to determine if fraud has been proven; the list includes things like keeping two sets of books, asking people to pay your business in cash instead of by check, hiding your assets in names of nominees, manufacturing forged receipts to substantiate claimed deductions, and the like.
I was audited once in 1993 for my 1987 return , they claimed I owed them still for that year . It took three years and $1500.00 for an Attorney to prove that they still owed me a little less than $200.00 when I refiled . During the 3 yr. battle they kept all my returns as partial settlement and attempted to attach my earnings . In the end they refunded all money with held with some small interest but did not pay the additional $200.00 they owed when I refiled .
This was done during the Clintoon Admin. when he paid a bounty to IRS agents for researching past returns for more money owed to the IRS .
I won my challenge but lost money proving that they don’t know their @$$ from a hole in Al Gore’s face .