- 5 - allocation it chooses. See Estate of Baumgardner v. Commissioner, 85 T.C. 445, 459 (1985). The taxpayer does have a right to direct his or her voluntary payment but must make the request or designation how the money is to be applied. See Wood v. United States, 808 F.2d 411, 416 (5th Cir. 1987); Muntwyler v. United States, 703 F.2d 1030, 1032 (7th Cir. 1983); Estate of Baumgardner v. Commissioner, supra at 459-460. In the case at hand, petitioners did not designate on the check or otherwise where they wanted the funds to be applied. Respondent made the allocation to the 1994 tax year. In 1997, when the 1994 return was filed, respondent refunded the $10,000 along with the excess withholding to petitioners. Petitioners claimed on their 1995 return an estimated tax payment or carryover from the 1994 return of $10,000. However, respondent had not yet received petitioners’ 1994 return. Lastly, petitioners’ contention that the $10,000 payment should be applied to the tax deficiency with the excess refunded to them is absurd, since the $10,000 has already been refunded to them.5 On the basis of this record, we hold that respondent did not err in allocating petitioners’ voluntary undesignated payment to 5 Under the circumstances presented to the Court, petitioner should consider himself fortunate that we have not imposed a penalty for raising frivolous issues. See sec. 6673(a).Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011