CCA 200848075: Certain large refunds do not require Joint Committee reporting

Plain-English summary

Chief Counsel discussed whether an estate case refund had to be reported to the Joint Committee on Taxation. The email explained that the Joint Committee generally does not review refunds arising from original returns, such as returns of withholding or estimated tax, while the IRS reports refunds from amended returns or refund claims. IRC § 6405 covers specified taxes, including estate tax, but the Internal Revenue Manual excludes several categories from reporting. Those exclusions include certain unexamined estimated or withheld tax refunds, returns of unassessed deposits or excess tentative-return payments, unpaid assessment abatements, and court-determined overpayments after trial. The email concluded that the estate case appeared to fall within the first nonreported category.

Ruling snapshot

• Question: Must the estate case refund be reported to the Joint Committee on Taxation under IRC § 6405?
• Outcome: Advice given. The case appeared to fit a category that is not reported.
• Key authorities: IRC §§ 6404 and 6405; IRM 4.36.2.3.

Full text (IRS public release)

ID: CCA-825114-08 Number: 200848075
Office: -----------
Release Date: 11/28/2008

UILC: 6405.00-00

From:
Sent: August 25, 2008
To:
Cc:
Subject: Estate case ---------

I spoke with --------------------------in ---------. JCT does not generally look at refunds arising from original returns, e.g., return of withholding or estimated taxes. IRS reports refunds arising from amended returns or claims for refund. Section 6405 limits review by JCT to certain types of taxes including estate taxes. IRM 4.36.2.3 provides that certain situations are not "reported" to the JCT. The --------- case appears to fall into the first category:

a. A refund or credit of estimated or withheld income tax, made without first examining the return. b. A refund or credit of an unassessed advance payment or deposit made before determining a taxpayer's tax liability, or a refund or credit of an amount paid on a tentative return in excess of the amount of the tax liability reported by the taxpayer on a final return. A final return is defined as the last return filed by the due date for that return. c. Prior reports submitted to the JCT are not considered in determining whether the case meets Joint Committee criteria. In addition, if a case, which was previously closed, did not exceed $ 2,000,000, such amount should not be combined with any subsequently determined refund or credit in computing Joint Committee jurisdiction. d. A case of any type involving overassessments (as distinguished from overpayments) in excess of $ 2,000,000. For example, an abatement of an unpaid portion of an assessment under IRC section 6404 regardless of the amount is not a "refund or credit" under IRC section 6405. e. An overpayment determined by the United States Tax Court or any other court of competent jurisdiction as a result of the trial of a case (rather than by a stipulation of settlement).