BankAmerica Corporation, as successor in interest to Continental Bank Corporation, as successor in interest to Continental Illinois Corporation - Page 10

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                         (2) the taxpayer has paid the entire amount                  
                    of the deficiency plus interest claimed by the                    
                    Secretary, and                                                    
                         (3) within 1 year after the date the decision                
                    of the Tax Court becomes final under subsection                   
                    (a), the taxpayer files a petition in the Tax                     
                    Court for a determination that the amount of                      
                    interest claimed by the Secretary exceeds the                     
                    amount of interest imposed by this title,                         
               then the Tax Court may reopen the case solely to                       
               determine whether the taxpayer has made an overpayment                 
               of such interest and the amount of any such                            
               overpayment.  * * *                                                    
          See also Rule 261, which implements sec. 7481(c); Note to Rule              
          261, 93 T.C. 1040-1041; Stauffacher v. Commissioner, 97 T.C. 453,           
          455-456 (1991).  There is no dispute that, as to both tax years,            
          the three requirements of section 7481(c) have been met.                    
               First, the entire amount of the deficiency plus interest has           
          been paid.  Sec. 7481(c)(2); Melin v. Commissioner, 54 F.3d 432             
          (7th Cir. 1995), affg. an order of this Court.                              
               Second, a timely petition was filed.  Sec. 7481(c)(3).                 
               Third, a deficiency which includes interest has been                   
          assessed in respect of each year.  Sec. 7481(c)(1); Asciutto v.             
          Commissioner, T.C. Memo. 1992-564, affd. 26 F.3d 108 (9th Cir.              
          1994).  In this connection, even though an overpayment was                  
          ultimately found for 1977, there was a deficiency for the period            
          during which interest accrued, which is the subject of this                 
          dispute.  In addition, where we have jurisdiction to determine an           
          overpayment (as we did in the original deficiency proceeding in             
          this case), we also have jurisdiction over the interest on that             
          overpayment.  Estate of Baumgardner v. Commissioner, 85 T.C. 445            




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