Bobby B. Smathers and Kathleen N. Smathers - Page 5




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          2.  Carryover Credit From Taxable Year 1990 to Taxable Year 1991            
               On their late-filed 1990 Federal income tax return,                    
          petitioners showed a $7,631 overpayment, which they requested be            
          applied to their 1991 estimated tax.  Consistent with this                  
          position, on their late-filed 1991 Federal income tax return,               
          petitioners claimed $7,631 as “1991 estimated tax payments and              
          amount applied from 1990 return”.                                           
               Respondent’s certificate of assessments and payments for               
          petitioners’ 1990 taxable year, by contrast, shows that                     
          petitioners overpaid their 1990 joint Federal income taxes by               
          only $1,028, $876 of which respondent transferred to cover                  
          petitioners’ unpaid 1989 Federal income tax liabilities,                    
          additions to tax, and interest.  Respondent transferred a                   
          carryover credit of the remaining overpayment of $152 from                  
          taxable year 1990 to petitioners’ 1991 accounts.  Respondent                
          contends that petitioners are entitled to no additional carryover           
          credit from 1990 to 1991.                                                   
               The difference between the $7,631 overpayment claimed by               
          petitioners on their 1990 return and the $1,028 overpayment                 
          reflected in respondent’s records is attributable to $6,603                 
          claimed on petitioners’ 1990 joint Federal income tax return as             
          “1990 estimated tax payments and amount applied from 1989                   










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