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Mitigation provisions apply only to income taxes.

The Halls sought a refund of overpaid windfall profit taxes. Although the statute of limitations for filing such a claim had expired, they argued the mitigation provisions-- IRC sections 1311 to 1314 ....applied to their claim. Under certain circumstances, the mitigation provisions can reopen an expired statute of limitations on refunds.

Result: For the IRS. The claim is time-barred. The 10th Circuit Court of Appeals ruled the mitigation provisions apply only to income taxes and not to the windfall profits tax, which was an excise tax. (The windfall profits tax was repealed in 1988.) Regulations section 1.1311(a)-2 limits the statute to income taxes.

In agreement are the Court of Claims (Evans Tr., 1972) and the Eastern District of Pennsylvania (Provident National Bank, 1981). However, one circuit court has said the mitigation provisions could apply to non-income taxes. (See Chertkoff, 4th Cir., 1982.)

* Hall (lOth Cir., 1992).

Edited by Anne Wagenbrenner, JD, LLM, editor, AICPA client newsletters.
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Author:Wagenbrenner, Anne
Publication:Journal of Accountancy
Article Type:Brief Article
Date:Jan 1, 1993
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