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rate. The taxpayer in the case pending before this Court for the
present years then claimed that the Commissioner's failure to
offset, pursuant to section 6402(a), caused the taxpayer to
overpay interest for the years before the Court (the present
years' overpayments).5
The issue in Winn-Dixie Stores, Inc. was whether the
Commissioner abused his authority by failing to offset the prior
years' overpayments against the present years' underpayments.
The Commissioner argued that, pursuant to section 6512(b)(4),
this Court did not have jurisdiction to decide that matter.
The Court agreed that, under section 6512(b)(4), the Court
does not have authority to restrain or review any credit or
reduction made by the Commissioner under section 6402. However,
the Court held that, under section 6512(b)(1), this Court has
jurisdiction to find that there is a deficiency in tax, or to
find that there is no deficiency in tax, and, in either
situation, the Court has jurisdiction to determine whether there
has been an overpayment. The Court further pointed out that, in
connection with a deficiency determination, the amount of
5 Interest on the present years' underpayments was
affected because there is no net interest due for the period of
mutual indebtedness if the Commissioner exercises his authority
to offset under sec. 6402(a). See sec. 6601(f). However, there
is net interest due if there is no offset. Net interest results
in this instance because the rate for calculating interest on
overpayments is less than the rate for calculating interest on
underpayments. See sec. 6621(a).
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Last modified: May 25, 2011