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Application of the 1987 Overpayment
The crux of petitioner’s argument is that if respondent had
applied the 1987 overpayment, generated from the 1989 and 1990
NOL’s, “as an estimated tax payment toward any tax liability due
on my 1990 return and later years” as he requested in the July
30, 1992, letter, the tax liabilities for 1991, 1992, and 1996
would have been paid. We review respondent’s determination de
novo, as the validity of the underlying tax liability, “i.e., the
amount unpaid after application of credits to which petitioner is
entitled,” is properly at issue. See Landry v. Commissioner, 116
T.C. 60, 62 (2001).
Section 6401(b)(1) provides: “If the amount allowable as
credits * * * exceeds the tax imposed * * * the amount of such
excess shall be considered an overpayment.” The Commissioner may
first credit any overpayment against “any outstanding liability
for any tax * * * owed by the taxpayer making the overpayment”.
Sec. 301.6402-3(a)(6)(i), Proced. & Admin. Regs. Any remaining
overpayment may be applied to the estimated tax but only “for the
taxable year immediately succeeding the taxable year for which
such return (or amended return) is filed.” Sec. 301.6402-
3(a)(5), Proced. & Admin. Regs. (emphasis added); see also sec.
6402(b). The Commissioner shall refund any balance of the
overpayment to the taxpayer. Sec. 6402(a).
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Last modified: May 25, 2011