- 11 -
respectively. If, however, the tentative refunds do not
constitute "rebates" to petitioner and the group, then (1)
petitioner and the group are liable for a deficiency in the
amount of $1,560,417 for 1981, and (2) there is no deficiency in
the income tax of petitioner and the group for 1984. Instead,
for 1984, petitioner and the group are entitled to recover an
overpayment of the income tax of the group in the amount of
$1,018,849.
Discussion
The issue we must decide is whether the tentative refunds
paid to Acme with respect to 1981 and 1984 constitute rebates to
petitioner and the group for purposes of computing the group's
deficiencies for 1981 and 1984, if any, pursuant to section 6211.
Section 6211(a) defines the term "deficiency" as the amount by
which the tax actually imposed exceeds--
(1) the sum of
(A) the amount shown as the tax by the taxpayer upon
his return, if a return was made by the taxpayer and an
amount was shown as the tax by the taxpayer thereon, plus
(B) the amounts previously assessed (or collected
without assessment) as a deficiency, over--
(2) the amount of rebates, as defined in section
6211(b)(2), made.[6] [Emphasis added.]
6 Reduced to mathematical terms, the statutory definition of
the term "deficiency" may be stated as follows:
Deficiency = correct tax - (tax on return + prior assessments - rebates)
= correct tax - tax on return - prior assessments + rebates
(continued...)
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011