CCA 201118018: Excessive assessed tax should be abated under IRC § 6404(a)

Plain-English summary

Chief Counsel addressed the treatment of tax that had already been assessed in an excessive amount. The advice states that the IRS should assess and collect only tax imposed by the Internal Revenue Code. If the Service determines that an assessment is excessive, it should abate the excessive tax under IRC § 6404(a). The taxpayer does not obtain a court action on the merits merely from the abatement, but may acquire the right to bring a refund suit after paying the assessed tax.

Ruling snapshot

• Question: What should the IRS do when tax already assessed is excessive?
• Outcome: Advice given.
• Key authorities: IRC § 6404(a).

Full text (IRS public release)

ID: CCA_2011040509233355 Number: 201118018
Release Date: 5/6/2011
Office: ----------------------------
UILC: 6404.00-00

From: ---------------------
Sent: Tuesday, April 05, 2011 9:23:36 AM
To: ------------------
Cc:
Subject: RE: abatement of unpaid 706 or 709 tax ---------

The rationale is that the IRS should only be assessing, and collecting the tax imposed by the Internal
Revenue Code. If the IRS determines that the tax already assessed is excessive, then it abates the tax
as excessive under 6404(a). However taxpayer has no right to sue in court like he would if he paid the
assessed tax and thus acquires the right to bring a refund suit in order to litigate the merits of the tax.