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petitioner’s deficiency to reflect the disallowance of a $2,256
additional child tax credit that petitioner never claimed.8
Having effectively conceded this error in the notice of
deficiency, respondent attempts in this proceeding to sustain a
portion of the $2,256 deficiency adjustment on a different
ground. Specifically, respondent contends that petitioner’s
deficiency properly includes $1,725 attributable to petitioner’s
overstatement of estimated tax payments.9 We disagree. The
record does not disclose the source of the $1,738 intercepted
Federal payment (which subsumes the $1,725 item in question).
Because section 6402(d) authorizes the Secretary to pay over “any
overpayment” to a Federal agency to discharge nontax debts, we
infer that the payment the Treasury Department intercepted and
paid over to DOE on April 26, 2002, was with respect to
8 Similarly, the notice of deficiency included in
petitioner’s deficiency a $25 adjustment attributable to a
reduction in the allowable amount of petitioner’s earned income
credit, even though petitioner claimed no earned income credit.
In the Rule 155 computations, we expect respondent to make
appropriate adjustment with respect to this item.
9 This leaves unaccounted for $531 of the $2,256 deficiency
adjustment. The parties have stipulated that petitioner is
entitled to withholding credits of $531. We treat this
stipulation as a concession by respondent that the deficiency
should exclude any adjustment related to this $531 item. We
further note that by definition a deficiency is determined
without regard to the sec. 31 credit for tax withheld on wages.
See sec. 6211(b)(1).
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Last modified: May 25, 2011