T.C. Summary Opinion 2002-126
UNITED STATES TAX COURT
JOHN F. HEYSE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 6638-01S. Filed October 3, 2002.
John F. Heyse, pro se.
James N. Beyer, for respondent.
DINAN, Special Trial Judge: This case was heard pursuant to
the provisions of section 7463.1 The decision to be entered is
not reviewable by any other court, and this opinion should not be
cited as authority.
This case is before us on petitioner’s petition under
1
Section references are to the Internal Revenue Code in
effect at the time the petition was filed in this case.
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section 6015(e)(1) for relief from joint and several liability.
Specifically, petitioner seeks a refund pursuant to respondent’s
determination that he is entitled to relief under section 6015(c)
with respect to taxable year 1993.
Some of the facts have been stipulated and are so found.
The stipulations of fact and the attached exhibits are
incorporated herein by this reference. Petitioner resided in
Wilmington, Delaware, on the date the petition was filed in this
case.
There are no relevant disputed facts in this case.
Petitioner and his former spouse filed a joint Federal income tax
return for taxable year 1993. Petitioner was subsequently
divorced from his spouse, and he has lived alone and has been
filing separate returns since 1994.
In 1996, respondent assessed a deficiency of $15,479, plus
interest, relating to petitioner’s taxable year 1993. This
deficiency was never paid directly by petitioner to respondent.
On February 23, 1998, a Federal income tax overpayment by
petitioner of $6,842 with respect to his 1997 taxable year was
applied to the 1993 liability. On April 12, 1999, a 1998
overpayment by petitioner of $9,891 was applied to the remaining
1993 liability.2
2
The amounts credited to petitioner’s 1993 tax liability
exceed the deficiency amount. Respondent’s counsel stated at
(continued...)
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On August 9, 1999, petitioner requested relief with respect
to the 1993 liability under section 6015(b), (c), and (f). On
March 27, 2001, respondent issued a notice of determination
granting petitioner partial relief pursuant to section 6015(c).
The notice stated that petitioner had requested relief in the
amount of $24,093, that relief had been granted in the amount of
$20,367, and that there was tax remaining of $3,729.3 The notice
also stated that refunds were not allowed with respect to section
6015(c) relief.
Petitioner filed a petition in this Court seeking relief
pursuant to section 6015. He requests that this Court:
determine that Petitioner is eligible for relief under
Section 6015 in the amount of $20,367.00 and direct the
Internal Revenue Service to issue a refund to Petitioner in
the amount of $20,367.00, together with statutory interest
thereon, pursuant to Section 6015 of the Internal Revenue
Code.
Respondent argues that any refund is barred by section
6015(g)(3).
Section 6015, as amended, was originally enacted in 1998 to
replace former section 6013(e). Internal Revenue Service
2
(...continued)
trial that the excess was applied to assessed interest. Neither
party specifically addressed this point, but respondent
presumably has relieved petitioner from liability for any
remaining unpaid interest.
3
It is unclear what the basis for this determination was,
however, because sec. 6015(c) relief applies to assessed
deficiencies. Sec. 6015(c)(1). The deficiency in petitioner’s
case was only $15,479.
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Restructuring and Reform Act of 1998, Pub. L. 105-206, sec. 3201,
112 Stat. 685, 734. The provision provides relief from joint and
several liability for certain taxpayers who file a joint Federal
income tax return. In general terms, there are three avenues of
relief under section 6015: Section 6015(b) may provide relief
with respect to certain erroneous items on the return, section
6015(c) may provide for a separation of liability for separated
taxpayers, and section 6015(f) may provide equitable relief for
taxpayers who otherwise do not qualify for relief under either of
the other two provisions. As a general rule, taxpayers who
qualify for relief under section 6015(b) or (f)--but not section
6015(c)--are entitled to a refund or credit attributable to the
application of section 6015. Sec. 6015(g)(1), (3).
After a taxpayer requests relief under section 6015, the
taxpayer may petition this Court for a review of respondent’s
subsequent determination. Sec. 6015(e)(1)(A). Our jurisdiction
in cases brought under section 6015(e)(1) encompasses a review of
respondent’s determination with respect to all relief afforded by
section 6015. Fernandez v. Commissioner, 114 T.C. 324, 331
(2000). Thus, we have jurisdiction to review respondent’s
determination that no refund is due petitioner pursuant to
section 6015(g)(3). However, we note that we have jurisdiction
with respect to only a portion of the tax liability at issue in
this case. Overpayments which are credited to another year’s tax
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liability are deemed to be payments at the time the credit is
made. Secs. 6402(a); 7422(d); Culpepper-Smith v. United States,
82 AFTR 2d 98-6212, 98-2 USTC par. 50,721 (E.D. Pa. 1998).
Accordingly, payment of petitioner’s 1993 tax liability was made
on February 23, 1998, and April 12, 1999. Section 6015 applies
to tax liabilities arising after or remaining unpaid on July 22,
1998. Internal Revenue Service Restructuring and Reform Act of
1998, Pub. L. 105-206, sec. 3201(g)(1), 112 Stat. 685, 740. In
this case, section 6015 applies only to that portion of
petitioner’s tax liability which remained unpaid after respondent
applied the first credit on February 23, 1998. Because the sole
basis for our jurisdiction in this case is section 6015(e), we
lack authority to grant relief with respect to the portion of the
1993 tax liability which was paid on February 23, 1998. Brown v.
Commissioner, T.C. Memo. 2002-187.
It is clear that the deficiency determined by respondent for
taxable year 1993 has been paid in full, and that the basis of
the relief respondent granted to petitioner was section 6015(c).
Consequently, section 6015(g)(3) bars any refund to petitioner as
a result of respondent’s determination that petitioner was
entitled to relief. Respondent’s determination letter does not
address petitioner’s alternative requests for relief under
section 6015(b) and (f), for which a refund would not be barred.
Nor was this issue addressed by petitioner in the petition or at
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trial.4 Furthermore, the record before us contains insufficient
facts to support a finding that petitioner was entitled to relief
under either alternative provision.5
Petitioner argues that he is entitled to a refund because
the payment of the deficiency was “involuntary” in that the
liability was satisfied by respondent’s crediting of later years’
overpayments to the 1993 deficiency, without notification to or
permission by petitioner. Respondent, however, has discretion to
credit overpayments to any outstanding tax liabilities, and the
crediting of such an overpayment is treated as if the taxpayer
had received a refund and in turn paid the tax liability. Secs.
6402(a), 7422(d); Culpepper-Smith v. United States, supra. The
1993 tax liability has been satisfied, and section 6015(g)(3)
clearly prohibits a refund resulting from relief afforded by
section 6015(c).
Reviewed and adopted as the report of the Small Tax Case
Division.
4
Petitioner states in his petition that “Taking into account
all the facts and circumstances, it is inequitable to hold the
Petitioner liable.” Language similar to this is found in both
sec. 6015(b) and (f). However, petitioner did not specifically
refer to either of these provisions, and at trial the focus of
petitioner’s argument was on the fact that payment of the 1993
tax deficiency was “involuntary”, as discussed infra.
5
Petitioner would not be entitled to relief under sec.
6015(f) unless it were shown that, contrary to respondent’s
determination, petitioner is not entitled to relief under sec.
6015(c). Sec. 6015(f)(2).
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To reflect the foregoing,
Decision will be entered
for respondent.