Academic journal article Journal of Accountancy

Request for Replacement Estate Tax Check Denied

Academic journal article Journal of Accountancy

Request for Replacement Estate Tax Check Denied

Article excerpt

The U.S. Court of Federal Claims held it did not have jurisdiction to issue a replacement check to a U.S. executor after a foreign executor named to the same estate cashed a refund check from the IRS.

The issue arose after a U.S. citizen died in 2006 while living in France, resulting in individuals' in the U.S. and France being named as executors of her estate. In August 2007, the U.S. executors requested an extension of time to file the decedent's estate tax return. The request was accompanied by a payment of $17.5 million in estate taxes. In February 2008 the French executor, who is the decedent's son, filed an estate tax return showing an overpayment of approximately $10.4 million. The filing was apparently unknown to the U.S. executors, who later the same month filed an estate tax return on behalf of the decedent showing an overpayment of approximately $5.1 million. Based on the first return filed, the IRS issued a $10.4 million refund to the decedent's son, as executor of her estate. The check was cashed. Upon learning of the refund, the U.S. executors filed a complaint in the Court of Federal Claims, seeking a replacement check for the $10.4 million paid to the foreign executor as well as a refund of $5.1 million.

The U.S. executors made three arguments to support their position that the Court of Federal Claims had jurisdiction. First, the executors claimed jurisdiction under 31 USC [section] 3702, the general claim submission statute. The court noted, however, that section 3702 does not provide an independent basis for jurisdiction but merely provides rules and procedures for settling claims. For the court to have jurisdiction, a plaintiff must identify a money-mandating statute--that is, a contract, federal statute, regulation or provision of the U. …

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