Taxing Lessons From Court Decisions

Refund Claims

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T.C. Memo. 2010-63 (Petty) offers a lesson in the perils of failing to file a return within the statutory time frame to claim an overpayment per IRC Sections 6511 and 6512.

In this case, the taxpayer made estimated tax payments during 2004. She filed a timely extension for her return, but failed to file the forms by the extended due date of August 15, 2005. The IRS sent a notice of deficiency on August 11, 2008. In response, the taxpayer filed her return on November 7, 2008. The return showed an overpayment. Because none of the overpayment was paid within the three year period required under sections 6511 and 6512, the IRS refused to issue a refund.

At risk: An overpayment of $23,570.

The court agreed with the IRS.

Taxing Lesson: Refunds are not guaranteed or automatic.