James C. and Jane A. Wetzel - Page 3

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          underpaid their 1992 Federal income tax by $165.  Respondent                 
          contends that this is the end of the matter.  Petitioners assert             
          that they are entitled to offset the $475 overpayment against                
          this liability and are therefore entitled to a refund in the                 
          amount of $310.                                                              
               At the outset, we note that respondent had the authority to             
          apply petitioners' overpayment against any outstanding tax                   
          liability they owed, and that such an application does not                   
          preclude respondent from subsequently determining a deficiency               
          with respect to the taxable year of the overpayment.  Sec.                   
          6402(a); Terry v. Commissioner, 91 T.C. 85 (1988); Jarrett v.                
          Commissioner, T.C. Memo. 1992-181.  We do not understand                     
          petitioners to contend otherwise.                                            
               As we understand it, petitioners assert that they are                   
          entitled to credit the $475 overpayment against their 1992 tax               
          deficiency and receive a refund of the excess.  However,                     
          petitioners have already received a $475 refund in the form of a             
          reduction of the outstanding section 6672 liability.                         
          Consequently, the application of the $475 overpayment to                     
          petitioners' 1992 tax deficiency that petitioners seek would                 
          amount to a double refund, to which petitioners are obviously not            
          entitled.  Jarrett v. Commissioner, supra.                                   

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