- 20 -
that respondent could not recover the tentative refunds from
Interlake through the deficiency procedures.1
Interlake was represented by Messrs. Newman and Updegraft
during all phases of the proceedings before the Court in
Interlake v. Commissioner, supra.
Summary Assessment of the 1985 Tentative Refund
In March 2000, respondent made a “summary assessment” under
section 6213(b)(3) of the $3,542,388 tentative refund respondent
had paid petitioner for 1985. Section 6213(b)(3) provides that
1On Sept. 26, 2000, respondent issued proposed regulations
that purport to clarify and supplement the rules under sec.
1.1502-77, Income Tax Regs., concerning the agent for an
affiliated group and the designation of a new agent for the
group. The proposed regulations also purport to clarify and
modify the rules concerning the proper party to apply for and
receive a refund attributable to a tentative carryback adjustment
under sec. 1.1502-78, Income Tax Regs. See secs. 1.1502-77 and
1.1502-78, Proposed Income Tax Regs., 65 Fed. Reg. 57755-57763
(Sept. 26, 2000). The preamble to the proposed regulations cites
the difficulties in applying the existing regulations to
situations in which an affiliated group continues following a
restructuring, as highlighted by Interlake Corp. v. Commissioner,
112 T.C. 103 (1999). The proposed amendments to sec. 1.1502-
77(a), Income Tax Regs., provide that the common parent for a
consolidated return year remains the agent for the group for that
year as long the common parent continues to exist. This rule is
to apply even if the common parent, for whatever reason, ceases
to be the common parent. The proposed regulations amend sec.
1.1502-78(a), Income Tax Regs., to provide that the common parent
for the carryback year should file an application under sec. 6411
for a tentative carryback adjustment with respect to a loss or
credit arising in a separate return year that may be carried back
to a consolidated return year, and any tentative refund must be
paid to the corporation that was the common parent for the
carryback year.
Page: Previous 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 NextLast modified: May 25, 2011