Rev. Rul. 68-65

Advice has been requested whether a Form 870, Waiver of Restrictions on Assessment and Collection of Deficiency in Tax and Acceptance of Overassessment, which was executed by the taxpayer and filed within the statutory period of limitations for filing a claim for credit or refund, can be considered a valid claim for credit or refund of an overpayment due to the overassessment shown thereon. The question was raised in view of the provisions of section 301.6402-2(b)(1) and (c) of the Regulations on Procedure and Administration which read, in part, as follows:

(b) Grounds set forth in claim . (1) * * * The claim must set forth in detail each ground upon which a credit or refund is claimed and facts sufficient to apprise the Commissioner of the exact basis thereof. * * *. A claim which does not comply with this paragraph will not be considered for any purpose as a claim for refund or credit.

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(c) Form for filing claim . Claims by the taxpayer for the refunding of overpayments of taxes * * * shall be made on Form 843. * * *.

These provisions of the regulations are applicable to a situation where the taxpayer seeks to recover an alleged overpayment of tax. They require the taxpayer to state his claim specifically, in detail, and as precisely as possible on a Form 843, Claim, in order that the Service may proceed upon clearly defined bases in determining whether the taxpayer has in fact made an overpayment of tax which may be credited or refunded.

In this case, however, it had been determined, on specific grounds and from information otherwise obtained, that an overassessment existed prior to the time the taxpayer executed an acceptance of overassessment on Form 870. Therefore, the furnishing of information on Form 843 was not required for the purposes of that determination. Moreover, under the circumstances, a determination of whether the tax has in fact been overpaid does not depend upon such information.

Once it has been determined that the tax has been overpaid, the amount of the overpayment may be credited or refunded under the provisions of section 6402(a) of the Internal Revenue Code of 1954, subject to the limitations of section 6511. Whether a Form 870 on which an overassessment is accepted constitutes a valid claim for credit or refund is normally irrelevant. However, it may become extremely important where the overpayment is not credited or refunded within the applicable period of limitations. Under such circumstances the taxpayer's rights will have been preserved only by his having filed a valid claim.

The Form 870 on which the taxpayer has agreed to an overassessment of tax determined by the Service will, if executed and filed within the statutory period of limitations for filing a claim for credit or refund, be considered a valid claim for credit or refund of any overpayment of tax attributable to the overassessment. The grounds upon which the overassessment was determined by the Service shall be considered the basis of the claim. Bonwit Teller & Co. v. United States , 283 U.S. 258 (1931); Ct. D. 334, C.B. X-1, 328 (1931).

The principles of this Revenue Ruling apply equally to an acceptance of an overassessment of income, estate, or gift tax, as determined by the Service, on an Internal Revenue Service form of the 870 or 890 series.