Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax
This answer was rated:

Form 1120, cash basis. If Taxes paid to IRS are deductible,

are refunds for overpayment the...
Form 1120, cash basis. If Taxes paid to IRS are deductible, are refunds for overpayment the equivalent of income?
Show More
Show Less
Ask Your Own Tax Question
Answered in 9 minutes by:
10/28/2017
Chad EA, CFP ®
Chad EA, CFP ®, Enrolled Agent
Category: Tax
Satisfied Customers: 1,368
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA
Verified

Hello Jeff! My name is ***** ***** I will be able to assist you.

Refunds of over payments are not considered income. Generally, over payments represent a return of your post tax dollars paid in advance over the amount of your tax liability.

There are multiple reasons why you may receive an over payment so I have attached the below link for your convenience.

https://www.irs.gov/irm/part35/irm_35-008-003

Please let me know if you have any follow up questions or if you would like me to expand my answer.

Thank you!

Ask Your Own Tax Question
Customer reply replied 3 months ago
Chad, appreciate your help. I'm confused... Let's say I make a $1500 estimated payment with an extension form last year, and my liability winds up being $1000 when filing the return this year for last year's activity. Seems I would have a $1500 deduction last year. Are you saying there is NOT a $500 "income" this year? If so, I'd make a $11,500 estimated payment with the extension to increase expense, decrease net income in current year, then have $10,500 returned "tax free." please explain further. Also, as a layman, I didn't see how the link related to this circumstance. Thank you, --jeff

The $10,500 is returned to you tax free because the funds represent a return of your post tax income after your tax liability is calculated.

If you send in $11,500 (in hopes of increasing your expenses) the over payment is returned so the payment is then essentially not a deductible expense. The total expense for taxes is returned to $1,500

Ask Your Own Tax Question

If you make a $1,500 payment and the tax liability ends up being $1,000. The IRS will typically send you back the over payment and the $500 is not considered income. The $500 is considered a return of your money that you have already paid tax on.

I would be happy to explain further if I was not able to clarify you question for you

Ask Your Own Tax Question
Customer reply replied 3 months ago
almost there... what is the difference between the first scenario I gave and the second?

Both scenarios would have the same outcome.

In the second scenario the payment was used to increase expenses, but once the payment is returned because it is an overpayment, the expense has to be adjusted

Chad EA, CFP ®
Chad EA, CFP ®, Enrolled Agent
Category: Tax
Satisfied Customers: 1,368
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA
Verified
Chad EA, CFP ® and 87 other Tax Specialists are ready to help you
Ask your own question now

I​ received a notice that you have viewed my answer.

Please close out the questions so JustAnswer is notified I have completed the question.

Thank you

Ask Your Own Tax Question
Ask Chad EA, CFP ® Your Own Question
Chad EA, CFP ®
Chad EA, CFP ®
Chad EA, CFP ®, Enrolled Agent
Category: Tax
Satisfied Customers: 1,368
1,368 Satisfied Customers
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA

Chad EA, CFP ® is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,312 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,362 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

14,120 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,652 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
What is the IRS section that allows deduction of Portfolio
What is the IRS section that allows deduction of Portfolio Manager fees from annuities in the portfolio? … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
14,120 satisfied customers
We have an S-Corp with a negative Net Income, we've
We have an S-Corp with a negative Net Income, we've maintained a negative Net Income for a few years carrying over the deductions from the section 179 since we cannot use it, due to the negative incom… read more
Carter McBride
Carter McBride
LLM
439 satisfied customers
How can I reduce my tax liability? Now about 11K and 2K
How can I reduce my tax liability? Now about 11K and 2K state. It seem we don't qualify for many credits, thinking of filing married / seperate rather than joint. Also can contribute to IRAs to offset… read more
Chad EA, CFP ®
Chad EA, CFP ®
Enrolled Agent
1,368 satisfied customers
The standard deduction is 12,700 for married filing jointly
The standard deduction is 12,700 for married filing jointly why does the 1040 form say 4050? … read more
Barbara
Barbara
Enrolled Agent, Paralegal
4,051 satisfied customers
How do you split the tax liability from a house foreclosure?
how do you split the tax liability from a house foreclosure? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
My withholding exceeds my tax liability for each of the the
My withholding exceeds my tax liability for each of the the first three quarters of 2017. However, in December 2017 I received a taxable gift of $78,000 from which nothing was withheld. I know this mu… read more
abci168
abci168
Principal
27 satisfied customers
Is there a form to file with the IRS for tax periods that
Is there a form to file with the IRS for tax periods that have ran past the statute of limitations from the date of assessment … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
This is an income tax question. I am thinking of Deducting
This is an income tax question. I am thinking of Deducting next years giving to church this year with pending changes to tax law. As I recall, higher income levels reduce schedule allowable deductions… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I filed an extension on my tax return because I didn't know
I filed an extension on my tax return because I didn't know my tax credit. when do I need to have tis complete. … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
14,120 satisfied customers
What are our tax liabilities when we gift a large sum of
What are our tax liabilities when we gift a large sum of money and a house to our kids? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
From a tax liability perspective, what are the differences
From a tax liability perspective, what are the differences between filing taxes from a trust versus a personal income tax filing ?… read more
Chad EA, CFP ®
Chad EA, CFP ®
Enrolled Agent
1,368 satisfied customers
Figure out how much is my tax liability + my capital gains +
Figure out how much is my tax liability + my capital gains + depreciation recapture tax … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
I file form NYC-3L and add to my tax the first estimated
I file form NYC-3L and add to my tax the first estimated payment for the following year, I'm trying to find this amount of my tax return where it was included in current year taxes due, the 1st estima… read more
Fred Rook
Fred Rook
Corporate Controller
BSBA
94 satisfied customers
Does a go fund me account create a tax liability or is it
does a go fund me account create a tax liability or is it considered a donation? It is for assistance in covering medical bills. … read more
abci168
abci168
Principal
27 satisfied customers
I filed for an extension to file my 2017 income tax return.
I filed for an extension to file my 2017 income tax return. I recently suffered a stroke - 6 weeks ago - and have been unable to finalize my return. I should be able to file it within the next 30 days… read more
Barbara
Barbara
Enrolled Agent, Paralegal
4,051 satisfied customers
I filed an extension for 2013 tax return but no actual tax
i filed an extension for 2013 tax return but no actual tax return. Do I have until Oct. 15, 2017 to file for refund?… read more
Barbara
Barbara
Enrolled Agent, Paralegal
4,051 satisfied customers
I am trying to figure out the net income from the following
Hi. I am trying to figure out the net income from the following part-time jobs in MARYLAND and then the total net income. If possible, will you please send me how you arrived at the figures (the calcu… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Please estimate my IRS and CA-540 tax liability for 2017.
Please estimate my IRS and CA-540 tax liability for 2017. Plan to file, "Married filing separately" Gross salary income: $185,000. I will take early withdraw from IRA and 401K funds towards purchasing… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x