Question or Topic 

The Question:  How long do I have to submit a claim for refund to the IRS.  If I make the submission within the appropriate parameters and time frames, the IRS disallows may claim solely based upon incorrect assumptions what should I do?

DO IT YOURSELF

The Answer

You must file a claim for a credit or refund within 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later. If you do not file a claim within this period, you may no longer be entitled to a credit or a refund.

Solutions

Solutions are dependent upon facts & circumstances, law and the objectives.  These elements vary from one time to another, from one circumstance to another and from person or entity to another.

If you are positive the claim was correct and filed within the time period then you should pursue your claim.

If IRS has incorectly disallowed the claim you should have a professional with knowledge about your circumstances and the tax code.

Here is a sample of a letter I used in the past.  This will give some insight as to the knowledge you will need to do this.

To the following:

Internal Revenue Service

Name Redacted

Atlanta GA 39901

 and,

Internal Revenue Service Counsel

Name and

Mail code Redacted

Dallas TX 75244-4203

CC:            Senator Name Redacted

Street Redacted

Austin TX 78701

Fax: Redacted

            Congressman Name Redacted

Street Redacted

City Redacted

Fax: Redacted

Regarding Taxpayer Name and ID Number Claim for Refund

Document Transmitted Via: ___________________

Notice of Disagreement with Denial of Claim

The Service has no substantial justification for its position, has taken unreasonable action and this notice is informing the Service on what basis and factual grounds the taxpayers are making this claim and statement.  Since the Service has no substantial justification for its decision in the matter herein, the Service is being unreasonable and the failure to be reasonable has caused the taxpayers undue cost in pursuing administrative remedies and the unreasonableness has added  an unjustified burden by adding interest and penalties during the unnecessary and unsubstantiated denials.  Furthermore, the notice of denial was imperfect and deficient.  Furthermore, the assessment has been excessive and wrongfully collected under the internal-revenue laws.  The taxpayer has engaged the advice of legal counsel and is placing the Service on NOTICE BEFORE FILING FOR RELIEF IN THE UNITED STATES DISTRICT COURT.

Upon request you will be furnished copies of prior filings, and substantial evidentiary matters proving by direct evidence, and indirect evidence the taxpayers’ tax is not correct.

In reply as formal notification to the Service the following factual statements and Internal Revenue Code citations are submitted:

A – Name and Address of Taxpayers

Taxpayer Name, Number, Street All Redacted

B – Date and Symbols of Notifying Letter of Denial

Dec 1989 NO RESPONSE

Dec 1990 8/28/2000 LTR 105C 00000000000000

C – Years and Amounts Involved

Code section to consider initially: Title 26: §6402; §6404; §6511; §6513; §6532; §7430; §7811; §7422

D – Why the Service Denial Basis is not Correct

The Service has been unreasonable with its denial of the claim.

In the denial the Service States:

“You filed your tax return, showing an overpayment more than 3 years after the date it was due.  The law states you must file your tax return within 3 years from its due date in order to be eligible for a refund or credit of overpaid taxes reported on that return.  We consider tax withheld, estimated tax, or earned income credit, shown as credits on a return, as paid on the due date of the return.”

DISCUSSION: 

Please note the Service is not correct when it claimed the tax return was filed more than 3 years after the date it was due. 

Please note the Service does not refer to a citation for the authority to deny, so that the taxpayer may be allowed to ascertain whether the Service has substantial justification for the assertion it is making.  The taxpayer is left to speculate what the Service is claiming. 

Since the Service’s wording is very similar to §6513 then one is left to speculate the denial is based upon two code sections, §6513 being one of those sections.  Since the Service’s wording is very similar to USC Title 26 §6511 then one must assume the Service is using §6511 to deny the claim. 

The denial is not only a misuse of the §6511 Section, it is a partial application wherein the Service is choosing to ignore a portion of §6511 in an unreasonable, and malicious manner. 

I shall not quote the code but refer to the portion of §6511 which applies to this taxpayer – PLEASE REFER TO §6511(a) WHICH STATES “… or 2 years from the time the tax was paid, whichever of such periods expires the later”.

F – Disclosure of Administrative Remedies Exhausted

I shall note the dates and events and you may skip the discussion without delay should you need to – however as the taxpayer representative I will add some discussion which will give you a general description of the events which have shown the taxpayers’ attempts at explanation and the continued denial of the Service to acknowledge the facts.

DISCUSSION:  

So that the Service is fully aware of the sequence of events I am describing some of the events.  The Service is usually professional and reliable with the processing of items filed with the Internal Revenue Service.  Furthermore, most Service personnel are conscientious in performing duties.  However, there have been in the past, there are occurring now and the future will hold unusual decisions in the Service, unreasonable decisions in the Service and there will be lack of diligence with the processing of taxpayers’ filings and communication within the Service.  The Service is a very large organization and management of policies, procedures and personnel cannot be perfect in an imperfect world.  Because the world is imperfect, the Service has been granted authority to diminish the probable atrocities and unreasonable decisions that are probable to occur.  As an analogy I will remind the Service of the Internal Revenue Service personnel in the Austin Service Center  Data Processing Center shredding tax returns without processing the returns.  The Service sent out requests for the tax returns to be filed and in some cases notified taxpayers of impending enforcement actions – when in fact the returns had been filed.  With that reminder, then please read the discussion herein without bias or prejudice.

The Service is provided the authority to make abatements in unusual instances in order to apply the code in a fair, equitable, and reasonable manner.  Therefore there is no requirement the Service attempt to assess the most amount of tax, nor the most amount of interest or penalty, but only the correct amount.  The taxpayers have been working with the Service by Administrative Remedies to communicate the correct amount of tax and the Service will not listen.  So that I may emphasize the failures at communication I shall disclose to you my experiences as the taxpayers’ representative in this matter.

The letter from the Service, designated #00000000 contains two paragraphs that purport to paraphrase the law. The second of these contains a case citation to King v. U.S., a tax court case. The first reference to what "the law states", which is the most important to the determination, contains no citation to the code or to case law to support the paraphrase, or interpretation. The government’s assertion is as follows:

"The law states you must file your tax return within 3 years from its due date in order to be eligible for a refund or credit of overpaid taxes reported on that return."

Since there is no code or case citation, the taxpayer is forced to assume that the Service relied on USC Title 26 §6513 and §6511(a) because of the similarity of the language and subject of both the statement in the letter from the Service, and the language in the statutes. Section §6513 is concerned with the “TIME RETURN DEEMED FILED AND TAX CONSIDERED PAID” - and does not match the main portion of the fact pattern in this case, and has nothing to do with the claim that was filed.  That is because there were no credits addressed in the claim and no withheld or estimated taxes were addressed in the claim.  The claim and the payments of tax were filed simultaneously and the claim is allowed as enumerated in §6511.

The applicable part of Code Section §6511 reads as follows:

"Claim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within 2 years from the time the tax was paid." (Emphases added..)

The italicized portion of the provision appears to be "the law" on which the Service is relying.

However, the service has completely ignored the second part of the provision, which is underlined and in bold print. If in fact this is the Code provision to which the Service is referring, the Service has grossly misrepresented the law. If the taxpayer had relied on the statement of "the law" made by the Service in the Denial of Claim, the taxpayer may have accepted the decision to deny the claim without further protest. It appears that such blind reliance was the intent of the Service, since there were no references to the code section, as references were made with the other statement of "the law" in the same letter.  The Omission of the “or” portion of the statute creates an Error in the application of the Code.  In addition the Service, by its lack of Citation, has failed to take a position and failed to properly notify the taxpayer of its position.  This appears to be the intention and conduct of the Service so that it may “add”,  “change” or delete its “position” at will and for its convenience.  This would seem to be in opposition to the intention of the law that should be to raise questions based upon proper statute and to limit the changing of its position or petition at will.

It appears the Service is delaying a determination on the factual basis of the claim by attempting to deny the claim on a procedural basis. The taxpayer, who is a practicing attorney, advises me that if this is the Code provision to which the Service is referring, the Service’s Omission and Error is the kind of deception, which, if practiced by an attorney on a Court, would likely subject the attorney to severe disciplinary action, because it so grossly misstates the clear intent of the statute, to the benefit of the Service.

THE SERVICE IS WRONG IN ITS CHARACTERIZATION OF THE STATUTE AND UNREASONABLE IN ITS RELIANCE ON AND ITS MISSTATEMENT OF THIS STATUTE TO COME TO THE CONCLUSION TO DENY TUE CLAIM.

END OF DISCUSSION