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to R, the tentative refunds were paid, after a limited
examination pursuant to sec. 6411(b), I.R.C., to the
correct taxpayer (P) because they were paid to P, the
taxpayer who applied for the tentative carryback
adjustments on the basis of the CNOL that P claimed it
had incurred.
Held: The tentative refunds in issue are rebate
refunds as to P giving rise to deficiencies over which
the Court has jurisdiction. Sec. 6411(b), I.R.C.
requires R to make only a “limited examination” of an
application for tentative carryback adjustment and pay
the tentative refund within 90 days. When R paid the
tentative refunds to P, R had not finally determined
which affiliated group was the continuation of the
prespinoff affiliated group, and R was not required to
make that determination prior to paying the tentative
refunds. The tentative refunds were not paid because
of any clerical or computer error requiring nonrebate
characterization. The tentative refunds paid to P are
recoverable through the deficiency procedures.
Accordingly, the Court has jurisdiction to enter
decision on the stipulation of settled issues and will
do so.
David J. Duez, Matthew P. Larvick, and Gregory G. Palmer,
for petitioners.
Lawrence G. Letkewicz and Dana E. Hundrieser, for
respondent.
CONTENTS
Background . . . . . . . . . . . . . . . . . . . . . . . . . 4
The Restructuring and Spinoff . . . . . . . . . . . . . 5
Tax Indemnification Agreement Between Petitioner and
Interlake . . . . . . . . . . . . . . . . . . . . . . 6
Tax Filings by Interlake and Petitioner . . . . . . . . 10
Administrative Proceedings. . . . . . . . . . . . . . . 12
Notice of Deficiency and Stipulation of Settled
Issues. . . . . . . . . . . . . . . . . . . . . . . . 14
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Last modified: May 25, 2011