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regular interest rate left in section 6621(a)(1)(B) would apply
to any December 31, 1994, overpayment interest balance, even
though a corporation had a tax overpayment in excess of $10,000.
As explained, however, on the basis of the language of
section 6621(a)(1), as enacted, we conclude that the GATT rate
applies to a corporation’s December 31, 1994, overpayment
interest balance for further accrual of interest thereon after
December 31, 1994.
On brief, petitioners set forth an example involving a
corporation’s $100,000 tax overpayment for a year, as of
March 15, 1990. In petitioners’ example, on January 1, 1992,
respondent refunds to the corporation $50,000 in principal, and
on January 1, 1996, respondent refunds the remaining $50,000
principal balance. Petitioners then state:
For the 1992-1995 period, the applicable interest rate is
applied to $50,000 in remaining principal, plus previously
accrued interest. It is irrelevant to that latter
computation that the “original” overpayment was $100,000.
But if, under the governing statutory language in
petitioners’ example, a corporation’s overpayment of tax for a
year in excess of $10,000 triggered a reduction in the
overpayment interest rate, then the fact that the corporation’s
original overpayment was more than $100,000 would be highly
relevant. That is the situation presented to us herein.
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