Tax News

CCH (cch.taxgroup.com) reports:

An individual who received an erroneous refund, which was later recouped by the IRS via levy and wage garnishment, was not bound by the Code Sec. 7422
refund procedures, or the Code Sec. 6532 limitations period, in seeking recovery of the seized funds. The individual's tax liability was extinguished through withholding credits prior to receiving the erroneous refund and, therefore, the refund did not represent a payment of tax requiring the individual to follow refund procedures. The IRS was, however, required to use proper erroneous refund procedures to recoup the overpayment and its failure to do so entitled the individual to proceed on an illegal exaction theory in the Court of Federal Claims.
L.D. Pennoni, FedCl, 2007-2 USTC ¶50,834
Other References:
Code Sec. 6511
CCH Reference - 2007FED ¶39,080.3255
Code Sec. 6532
CCH Reference - 2007FED ¶39,280.21
Code Sec. 7422
CCH Reference - 2007FED ¶41,688.543
Tax Research Consultant
CCH Reference - TRC LITIG: 9,052
CCH Reference - TRC IRS: 45,162