Rev. Rul. 84-58

FACTS

The Internal Revenue Service has reconsidered Rev. Rul. 83-111, 1983-31 I.R.B. 5, and Rev. Rul. 77-475, 1977-2 C.B. 476, concerning application of overpayments of income tax against installment payments of estimated tax for the succeeding year.

Rev. Rul. 83-111 holds that such an overpayment will be applied against installment payments due on or after the date the election to apply the overpayment is made. In Situation 2 of Rev. Rul. 83-111, a taxpayer with an extension of time to file a return for calendar year 1979 filed the return on June 15, 1980. The overpayment shown on the return that arose from estimated tax payments made during 1979 was applied against the June 15 estimated tax installment for 1980 and not against the April 15 installment, as had previously been the case.

HOLDING

For returns filed after December 31, 1983, the Service will apply overpayments arising on or before the due date of a return against the first installment payment of the next year's estimated tax, unless the taxpayer notifies the Service that the overpayment should be applied against another installment. In Situation 2 of Rev. Rul. 83-111, the 1979 overpayment would be applied against the April 15, 1980, installment unless the taxpayer notified the Service to the contrary. In order to properly notify the Service that the overpayment should be applied against another installment, taxpayers must attach a statement to the income tax return showing the overpayment, indicating which installment of estimated tax the overpayment should be applied against.

EFFECT ON OTHER REVENUE RULINGS

Rev. Rul. 83-111 is revoked. Rev. Rul. 77-475 is reinstated as modified herein.

¹ Based on News Release IR 84-46, dated March 30, 1984.