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Question

Client filed form 1120 for 2004 on March 5, 2008. The return had a 1957.00 credit applied to 2005. 2005 return had extension filed thru 9/15/06. Return was never filed. If 2005 return(zero return) is filed today, can the credit be carried to 2006? And then possibly ask for refund with the 2006 return which will be the final return? 2005 could be final return as well!

Submitted: 68 days and 11 hours ago.
Category: Tax
Value: $30
Status: CLOSED
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Posted by bizmatters 68 days and 11 hours ago.

Info Request

Dear magisrated,

 

 

 

What kind of tax credit is this? what does it derive from?

 

i.e. adoptin credit, net operating losses, etc?

 

.

 

 

68 days and 11 hours ago.

Reply

Form 1120 Corporation Income Tax. 2004 return was filed March 15, 2008. It was a zero return. Taxpayer formed a corporation but never used it but did make a payment for 2004 using a tax deposit coupon. Don't know why!

Overpayment was credited to 2005. 2005 form 1120 had extension filed March 15, 2006 good thru September 15, 2006 but return was never filed. There is no income to this corporation, period. Is the credit salvageable? Can 04 return be amended to claim the refund? Any options at all? Thanks. Call if you wish. XXX-XXX-XXXX

Accepted Answer

A taxpayer may file a claim for a tax refund of an overpayment of any tax within 3 years from the time the tax return was filed with the IRS or 2 years from the time the tax was paid to the IRS, whichever period is the last. If no tax return was filed with the IRS, the claim may be made within 2 years from the date that the tax was paid to the IRS (Section 6511(a) of the Tax Code).


Hence there does not seem to be any possibility to get this refund.


However, if I was in your place, I would file the tax return for 2005 and request a refund or file the tax return for 2005 and apply to 2006 and request refund on the 2006 tax return. Atleast....worth a try!

Let me know if you have any question.

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

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Expert: RD
Pos. Feedback: 99.4 %
Accepts: 
Answered: 9/15/2009

Certified Public Accountant (CPA)

CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..

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