Deposit vs Payment

[solomon]

http://www.paed.uscourts.gov/documents/opinions/09d0408p.pdf

[WhiteOleander]

That is very interesting. Do you think that we could advise clients is a similar situation to label their check as "deposit for tax year XXXX" to keep the SOL from running out on them?

[Jesse]

So could withholding from W-2's be considered a deposit and not a payment?

[erchess]

Don't Understand

His memo on the check and its inclusion as an estimated tax payment on the return to me would support the IRS position and trump testimony about his intentions and the intentions of his preparer.

[Corduroy Frog]

Disagree

I normally applaud a court decision against the IRS, considering the way they steamroll their way through our economic structure, leave off definitions in the code so they can force people into wary judgmental results, etc.

But not this time. I would hate to have a client like this guy.

If someone wants license to waffle back and forth with big money, I hope they do so at their own risk and not drag me into it.

Very interesting case, Solomon.

[Larmil]

His memo on the check and its inclusion as an estimated tax payment on the return to me would support the IRS position and trump testimony about his intentions and the intentions of his preparer.

Can't the IRS appeal?

[OtisMozzetti]

So, if the IRS really considered the $50,000 that the taxpayer paid to be a payment toward only his 2000 taxes, why didn't they return the excess payment to the taxpayer?

For the IRS to say, "we didn't return your $50,000 to you within 3 SOL years, and therefore you'll never get your $50,000" does sound a bit inequitable, assuming that the word inequitable even applies with taxes.

I wish I understood why the taxpayer never bothered to ask for his $50,000 back, i.e. what else was going on during this time.

Or was it that the taxpayer just put $50,000 on deposit with the IRS, ready to pay whatever tax bills for 2000 or for future years that might come his way eventually?