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1981 Federal income tax and interest $132,776.23
1982 Federal income tax and interest 126,385.98
1981 State income tax and interest 3,657.86
1982 State income tax and interest 4,885.50
Total $267,705.57
As a result of the deductions, the amended return showed an
overpayment of estate tax in the amount of $108,689.
Since the amended return was filed more than 3 years after
the original return, respondent allowed a claim for refund only
to the extent of estate tax paid within 2 years before the
amended estate tax return was filed. See sec. 6511(a).
Respondent thus refunded $94,364 but not the remaining $14,325 of
the overpayment, which she determined to be barred by the statute
of limitations.
With respect to the overpayment in estate tax that has not
been refunded, $7,086.58 is attributable to the deduction for
1981 Federal income tax liability and $6,781.45 is attributable
to the deduction for 1982 Federal income tax liability.3
Petitioners argue that, under the doctrine of equitable
recoupment, the amount of the Federal income tax deficiencies
should be reduced by the time-barred overpayment of estate tax
resulting from the deductibility of such deficiencies. The
3 Petitioners concede they may not offset the deficiencies in
this case with overpayments due to deductions for State income
tax liability for 1981 and 1982.
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Last modified: May 25, 2011