Wetzel v. Commissioner

MEMORANDUM FINDINGS OF FACT AND OPINION

POWELL, Special Trial Judge: This case was assigned pursuant to the provisions of section 7443A(b)(3) and Rules*320 180, 181, and 182. ¹

Respondent determined a deficiency in petitioners' Federal income tax for the taxable year 1992 in the amount of $ 315. Petitioners resided in Hinckley, Ohio, at the time they filed their petition.

The issue is whether petitioners are entitled to offset against a deficiency in income tax an overpayment that was previously applied to a different liability.

FINDINGS OF FACT

The facts are not disputed and may be summarized as follows. Petitioners filed a 1992 joint Federal income tax return indicating that they were entitled to a refund in the amount of $ 475 (the $ 475 overpayment). Respondent applied the $ 475 overpayment against an outstanding liability determined under section 6672 pursuant to the authority granted in section 6402(a). ² Subsequently, respondent determined a deficiency in petitioners' 1992 Federal income*321 tax in the amount of $ 315. The parties agree that petitioners are entitled to a credit of $ 150 for income tax withheld to be offset against the deficiency. Petitioners do not otherwise dispute the deficiency determination. Thus, disregarding the propriety of the treatment of the $ 475 overpayment, the parties agree that petitioners underpaid their 1992 Federal income tax by $ 165. Respondent contends that this is the end of the matter. Petitioners assert that they are entitled to offset the $ 475 overpayment against this liability and are therefore entitled to a refund in the amount of $ 310.

OPINION

At the outset, we note that respondent had the authority to apply petitioners' overpayment against any outstanding*322 tax liability they owed, and that such an application does not preclude respondent from subsequently determining a deficiency with respect to the taxable year of the overpayment. Sec. 6402(a); ; . We do not understand petitioners to contend otherwise.

As we understand it, petitioners assert that they are entitled to credit the $ 475 overpayment against their 1992 tax deficiency and receive a refund of the excess. However, petitioners have already received a $ 475 refund in the form of a reduction of the outstanding section 6672 liability. Consequently, the application of the $ 475 overpayment to petitioners' 1992 tax deficiency that petitioners seek would amount to a double refund, to which petitioners are obviously not entitled.

In addition, petitioners have not shown that the $ 475 overpayment exceeded the section 6672 liability. Thus, to the extent petitioners may contend that they are entitled to some portion of the $ 475 overpayment because section 6402 was not applied*323 correctly by respondent, they have not met their burden of proof. Rule 142(a).

Decision will be entered for respondent.