FAA 20124602F

FAA 20124602F

Language in a Protective Claim for Refund is critical with regard to a subsequently filed claim. The IRS must be notified in a specific Protective Claim of all potential facts and circumstances on which a future claim might be based. In Field Attorney Advice 20124602F, dated October 4, 2012 (released November 16, 2012), - which deals with IRC section 481(a) and Form 1120 - the Protective Claim was limited to a a specific and identifiable item. The taxpayer was not permitted to later amend the Protective Claim to include new grounds that did not clarify those specifically raised in the Protective Claim.

The Advice discusses the difference between specific and general protective claims. An excerpt is shown here:

The Courts distinguish between “general” and “specific” refund claims. General claims assert that an overpayment has occurred, but do not state supporting facts or reasons. See United States v. Andrews, 302 U.S. 517, 524 (1938); United States v. Memphis Cotton Oil Co., 288 U.S. 62, 64-65, 70 (1933). In contrast, “specific” claims identify particular transactions or factual circumstances underlying the refund request. Andrews, 302 U.S. at 524-25.

It should be noted that the amendment of a timely specific claim is treated differently from the amendment of a general claim. A general claim may be amended following the running of the statute of limitations to supply the missing information that caused the claim to be classified as general. See , e.g. , Memphis Cotton Oil Co., 288 U.S. at 71.

A claim limited to a specific item may not be amended following the running of the statute of limitations to seek refund on account of other, unrelated items. Andrews, 302 U.S. at 524. Thus, a supplemental claim will not be considered an amendment to the original claim if it would require the investigation of new matters that would not have been disclosed by the investigation of the original claim. Id. at 524 - 26; Pink v. United States, 105 F.2d 183, 187 (2d Cir. 1939). Such a supplemental claim is a new claim, and not an amendment to the timely original claim.