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determining the taxable estate. In Herring, the Court of Appeals
found that, although the case might differ from Bull, in
practical effect both of the Government’s claims grew out of the
same transaction and were asserted against the same assets in the
hands of the executor. United States v. Herring, 240 F.2d at
228. The court in Herring distinguished Rothensies v. Electric
Storage Battery Co., supra, on the ground that the two sets of
transactions there had been so very remote from each other that
the claims for which recoupment was sought were long dead. Id.
at 227. In Bowcut, the District Court reached the same result on
the basis of Herring. Bowcut v. United States, 175 F. Supp. 218,
221-222 (D. Mont. 1959), affd. 207 F.2d 654 (9th Cir. 1961). The
Court of Appeals did not consider the single-transaction issue,
as the Government appealed primarily on other grounds, lack of
clean hands and laches, which the Court of Appeals rejected as
grounds for denying equitable recoupment, United States v.
Bowcut, 287 F.2d at 656-657 & n.1. The Commissioner acceded to
these decisions in Rev. Rul. 71-56, 1971-1 C.B. 404,13 which like
them concerns the application of a barred overpayment of Federal
estate tax against outstanding assessments of income tax owed by
a decedent for years preceding death and provides for
administrative allowance of equitable recoupment in that
situation.
13Revoking Rev. Rul. 55-226, 1955-1 C.B. 469.
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