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section 6512(b)(1) incorporates, have been satisfied so as to
allow the refund of the overpayment in this case. Because the
statutory notice in this case was mailed within 3 years of the
Administration Trust's overpayments of both income tax and estate
tax, section 6512(b)(3)(B) has been satisfied.
ii. Recoupment's defensive nature and the unrelated
overpayment don't bar recoupment
Respondent argues and the majority conclude that
petitioner’s overpayment status prevents us from applying
equitable recoupment. They've been beguiled by the notion that
allowing equitable recoupment when there's already a net
overpayment would increase the overpayment, and that this would
be the same as allowing an affirmative recovery of time-barred
taxes that recoupment can't provide. As we've said, Mueller II,
101 T.C. at 552, and as United States v. Dalm, 494 U.S. 596
(1990), clearly establishes, a taxpayer asserting equitable
recoupment may not affirmatively collect the time-barred
overpayment of tax, but may only use equitable recoupment to
reduce the Government’s timely determination of a deficiency.
Respondent and the majority (majority op. p. 8) cite for
their conclusion Brigham v. United States, 200 Ct. Cl. 68, 470
F.2d 571 (1972). There, the taxpayers were seeking refunds of
ordinary income tax paid in barred years that, it turned out
under a later Supreme Court case, had been erroneously paid,
because the underlying transaction should have been treated as an
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