Ronald C. Bachner - Page 1

                                   109 T.C. No. 7                                     


                               UNITED STATES TAX COURT                                


                          RONALD C. BACHNER, Petitioner v.                            
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      


               Docket No. 27019-92.               Filed September 24, 1997.           

                    P's employer withheld tax from his wages for 1984.                
               P filed a timely 1984 return reporting no tax liability                
               and claiming a refund for the withheld tax.  No tax has                
               ever been assessed or refunded for 1984.  R issued a                   
               notice of deficiency after the expiration of the period                
               of limitations.  Assessment of any tax against P for                   
               1984 is now barred.  P claims that the entire amount of                
               withheld tax is an overpayment within the meaning of                   
               sec. 6512(b), I.R.C.  R maintains that any overpayment                 
               is limited to the amount by which the withheld tax                     
               exceeds the amount of tax which might have been                        
               properly assessed but for the statute of limitations.                  
                    Held:  Pursuant to Lewis v. Reynolds, 284 U.S. 281                
               (1932), the amount of an overpayment for a taxable year                
               is limited to the excess of the tax paid over the                      
               amount which might have been properly assessed and                     
               demanded even though assessment is now barred by the                   
               statute of limitations.                                                






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