IRS Clarifies Authorization Dates For Refund Of Overassessed Tax
Rev. Rul. 2001-40; 2001-2 C.B. 276
- Institutional AuthorsInternal Revenue Service
- Code Sections
- Subject Areas/Tax Topics
- Index Termsrefunds, date of allowance
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 2001-23872 (1 original page)
- Tax Analysts Electronic Citation2001 TNT 180-10
Rev. Rul. 2001-40
PURPOSE
[1] This revenue ruling modifies the discussion of section 6407 of the Internal Revenue Code (the Code) in Rev. Rul. 78-127 (1978-1 C.B. 436). Specifically, this revenue ruling clarifies when the Internal Revenue Service (the Service) allows a refund or credit of an overassessed tax.
LAW AND ANALYSIS
[2] Section 6407 of the Code states: "The date on which the Secretary first authorizes the scheduling of an overassessment of any internal revenue tax shall be considered as the date of allowance of refund or credit in respect of such tax."
[3] Congress adopted the rule defining the scheduling date as the allowance date in the Revenue Act of 1926. See section 1116 of the Act, the predecessor of current section 6407 of the Code. The rule was designed to reflect Service processing practice. The legislative history explains:
In the case of refunds, interest is allowed "to the date of the
allowance of the refund." In practice, the Commissioner first
signs a schedule of overassessments, which is sent to the
collector, in order to determine whether the overpayment should
be credited or refunded. The committee amendment proposes to fix
as the date on which the refund is allowed the date on which the
Commissioner signs the schedule of overassessments. (S. Rep. No.
52, 69th Cong., 1st Sess. 38 (1926).)
[4] Section 301.6407-1 of the Regulations on Procedure and Administration reflects the legislative intent that the Secretary would delegate authority to allow refunds and credits to Internal Revenue Service officials. Over the years, different certifying officers have been authorized to schedule overassessments and allow refunds and credits.
[5] In addition, the Service has revised the method of scheduling overassessments and allowing refunds and credits. For example, the Service does not currently use Form 1166 to schedule overassessments. It may use different paper forms or electronic entries to schedule and allow refunds and credits. Regardless of processing method, the taxpayer's account will reflect the date that the certifying officer schedules the overassessment.
HOLDING
[6] Consequently, references to the Form 1166 and other processing forms are removed from Rev. Rul. 78-127. The two paragraphs beginning "Section 6407 of the Code . . ." are modified to read as follows:
Section 6407 of the Code provides that the date on which the
Secretary first authorizes the scheduling of an overassessment
of any internal revenue tax shall be considered the date of
allowance of any refund or credit of the tax. Section 301.6407-1
of the regulations delegates scheduling authority to a
certifying officer. The certifying officer authorizes a credit
or refund by signing a schedule of overassessments identifying
the taxpayer and the amount of the overassessment.
The date the summary record of assessment is signed, and the
date on which the schedule of overassessments is signed are
dates of authorization for the purpose of section 301.6521-1(c)
of the regulations.
EFFECT ON OTHER REVENUE RULING(S)
[7] Rev. Rul. 78-127 is modified.
DRAFTING INFORMATION
[8] The principal author of this revenue ruling is Tiffany P. Smith of the Office of the Associate Chief Counsel (Procedure and Administration), Administrative Provisions and Judicial Practice Division. For further information regarding this revenue ruling, contact Tiffany Smith at (202) 622-4910 (not a toll-free call).
- Institutional AuthorsInternal Revenue Service
- Code Sections
- Subject Areas/Tax Topics
- Index Termsrefunds, date of allowance
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 2001-23872 (1 original page)
- Tax Analysts Electronic Citation2001 TNT 180-10
