Joint Committee Refund Review: Twelve Questions to Consider

Twelve questions are answered concerning Joint Committee refund review. The Joint Committee has jurisdiction over two types of refunds: overpayment refunds and tentative adjustments. Interest and penalties are included in the $2 million jurisdictional amount. Deficiencies from the same year or other years to used to offset the potential refund amount for purposes of determining Joint Committee jurisdiction. In general, if a refund or credit has previously been reported to the Joint Committee, and a further overpayment in the same tax year is subsequently determined, the later refund is not reportable unless it independently exceeds the $2 million jurisdictional threshold. Litigation settlements are subject to Joint Committee review. The issuance of a tentative adjustment will not be delayed by Joint Committee review. The Joint Committee has jurisdiction over both the source year and the carryback year. If a refund year is under examination, or has been examined but not closed out of the examining group, and the taxpayer files an application for Tentative Adjustment, the examination will be extended to the source year of the application for Tentative Adjustment. An overpayment refund may be reported to Joint Committee consideration prior to the resolution of all issues under examination. Sometimes Appeals can allow tentative adjustments and submit reports to the Joint Committee for years under Appeals' jurisdiction if the source year is still under examination. The IRS does not have to follow the Joint Committee's recommendations.