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section 1.1502-78(b)(1), Income Tax Regs., required delivery of
the tentative refunds to petitioner, as the successor common
parent for the group. Accordingly, petitioner argues, the
tentative refunds are not rebate refunds with respect to
petitioner and the group and cannot be included in the
computation of the group's deficiencies for the years in issue.
Respondent concedes that a refund issued to the wrong
taxpayer, or to an unauthorized representative of the taxpayer,
is a nonrebate refund which may not be taken into account in
computing the taxpayer's deficiency. Respondent, however, argues
that the tentative refunds were not issued to the wrong taxpayer.
Respondent contends that payment to Acme was proper because,
pursuant to section 1.1502-78(b)(1), Income Tax Regs., and Union
Oil Co. v. Commissioner, 101 T.C. 130 (1993), both Acme and
petitioner were authorized recipients of the tentative refunds.
Accordingly, respondent argues, because the tentative refunds
were paid to an authorized recipient, such refunds constitute
rebate refunds with respect to the group for purposes of
computing its deficiencies for 1981 and 1984.
Section 6411(a) authorizes a corporation that has sustained
a net operating loss (NOL) to apply for a tentative carryback
adjustment of the tax for the prior taxable year to which the NOL
is carried. The application of section 6411, however, is subject
to such conditions, limitations, and exceptions as prescribed by
regulation when the applicant made or was required to make a
consolidated return either for the year in which the NOL arose,
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