Acme Steel Company (formerly known as Interlake, Inc., and now known as Acme Metals, Inc.) and Consolidated Subsidiaries - Page 28

                                       - 28 -                                         
               Nonrebate refunds, on the other hand, are issued to                    
          taxpayers because of clerical or computer errors, and they bear             
          no relation to a recalculation of tax liability.  See O’Bryant v.           
          United States, supra; Clayton v. Commissioner, T.C. Memo. 1997-             
          327.  A hallmark of nonrebate refunds is that, unlike rebate                
          refunds, nonrebate refunds are always erroneous.  Examples of               
          nonrebate refunds are refunds issued because the Commissioner               
          credited a taxpayer’s payment twice or the Commissioner applied a           
          payment to the wrong tax year.  The Commissioner is limited to              
          erroneous refund actions under section 7405 to recover nonrebate            
          refunds.  The deficiency procedures are not available to the                
          Commissioner to recover nonrebate refunds because of the                    
          definition of “deficiency” in section 6211(a):  A “deficiency” is           
          the amount by which the tax actually imposed exceeds--                      
                    (1) the sum of                                                    
                   (A) the amount shown as the tax by the                            
                    taxpayer upon his return, if a return was                         
                    made by the taxpayer and an amount was shown                      
                    as the tax by the taxpayer thereon, plus                          
          (B) the amounts previously assessed (or                                     
                    collected without assessment) as a                                
                    deficiency, over--                                                
                    (2) the amount of rebates, as defined in                          
                    subsection (b)(2), made.  [Emphasis added.]                       
          In Lesinski v. Commissioner, T.C. Memo. 1997-234, we held we do             
          not have jurisdiction over nonrebate refunds.                               







Page:  Previous  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  36  37  Next

Last modified: May 25, 2011