CCA 200920039: Section 6611 did not pay interest on returned product-purchase funds

Plain-English summary

Chief Counsel considered whether the government owed interest when returning money remitted to purchase CDs or other government products. The email gave a personal opinion that interest was not payable because section 6611 covers refunds of tax overpayments. It explained that the government generally pays interest only when a statute authorizes payment. Because section 6611 did not apply, another federal statute would have to create the right to interest. Counsel noted that questions under another title of the U.S. Code were outside IRS Chief Counsel’s jurisdiction and that no such statute came immediately to mind.

Ruling snapshot

• Question: Did the government owe interest when returning an amount paid to purchase CDs or other products from it?
• Outcome: Advice given: in Counsel’s personal view, no interest was payable under section 6611, and a different statute would be required.
• Key authorities: IRC § 6611; Library of Congress v. Shaw, 478 U.S. 310 (1986).

Full text (IRS public release)

ID: CCA_2009040213062942 Number: 200920039
Release Date: 5/15/2009
Office: --------------
UILC: 6611.00-00

From: -------------------------
Sent: Thursday, April 02, 2009 1:06:31 PM
To: -------------------
Cc:
Subject: returned user fee

You asked whether interest would be payable on the return of an amount remitted to the government to purchase CDs or other products from the government. My personal opinion is no, it is not payable. Interest is only paid upon a refund of a tax overpayment as provided in section 6611 of the IRC.

In general, interest is not paid by the government unless statutorily provided. See Library of Congress v. Shaw, 478 U.S. 310 (1986). Since section 6611 would not apply, the only way interest would be payable is if a specific statute under another title of the USC stated so. Such questions are not within the jurisdiction of Chief Counsel, IRS. Based on my personal experience, none immediately come to mind.