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Petitioners and respondent agree that the erroneous refunds
are nonrebate erroneous refunds because they were not created by
respondent’s substantive recalculation of petitioners’ Federal
gift tax liability; the erroneous refunds arose because of
respondent’s mistake or error. See O’Bryant v. United States, 49
F.3d 340 (7th Cir. 1995). Because the refunds are considered
nonrebate erroneous refunds, they do not enter into the
determination of deficiencies in petitioners’ Federal gift taxes
for 1993, 1994, and 1995. Sec. 6211(a) and (b); see O’Bryant v.
United States, supra; see also Interlake Corp. v. Commissioner,
supra.
As we stated above, our statutory authorization to decide
tax liabilities extends not only to deficiencies under section
6214(a) but also to overpayments (subject to specific limitations
not relevant here). Sec. 6512(b)(1).6
5(...continued)
F.3d 340 (7th Cir. 1995). Those cases are distinguishable from
the instant case in that they arose in Federal District Court and
under circumstances where the taxpayers had paid their taxes and
were seeking a refund. Thus, in those cases, the Commissioner
had made a final assessment.
6Sec. 6512 provides in part:
SEC. 6512. LIMITATIONS IN CASE OF PETITION TO TAX COURT.
(b) Overpayment Determined by Tax Court.--
(1) Jurisdiction to determine.--Except
as provided by paragraph(3) and by section
(continued...)
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