§ 6425. Adjustment of overpayment of estimated income tax by corporation

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(a)Application of adjustment

(1)Time for filing A corporation may, after the close of the taxable year and on or before the 15th day of the fourth month thereafter, and before the day on which it files a return for such taxable year, file an application for an adjustment of an overpayment by it of estimated income tax for such taxable year. An application under this subsection shall not constitute a claim for credit or refund.

(2)Form of application, etc. An application under this subsection shall be verified in the manner prescribed by section 6065 in the case of a return of the taxpayer, and shall be filed in the manner and form required by regulations prescribed by the Secretary. The application shall set forth—

(A)the estimated income tax paid by the corporation during the taxable year,

(B)the amount which, at the time of filing the application, the corporation estimates as its income tax liability for the taxable year,

(C)the amount of the adjustment, and

(D)such other information for purposes of carrying out the provisions of this section as may be required by such regulations.

(b)Allowance of adjustment

(1)Limited examination of application Within a period of 45 days from the date on which an application for an adjustment is filed under subsection (a), the Secretary shall make, to the extent he deems practicable in such period, a limited examination of the application to discover omissions and errors therein, and shall determine the amount of the adjustment upon the basis of the application and the examination; except that the Secretary may disallow, without further action, any application which he finds contains material omissions or errors which he deems cannot be corrected within such 45 days.

(2)Adjustment credited or refunded The Secretary, within the 45-day period referred to in paragraph (1), may credit the amount of the adjustment against any liability in respect of an internal revenue tax on the part of the corporation and shall refund the remainder to the corporation.

(3)Limitation No application under this section shall be allowed unless the amount of the adjustment equals or exceeds

(A)10 percent of the amount estimated by the corporation on its application as its income tax liability for the taxable year, and

(B)$500.

(4)Effect of adjustment For purposes of this title (other than section 6655), any adjustment under this section shall be treated as a reduction, in the estimated income tax paid, made on the day the credit is allowed or the refund is paid.

(c)Definitions For purposes of this section and section 6655(h) (relating to excessive adjustment)—

(1)The term “income tax liability” means the excess of—

(A)the sum of—

(i)the tax imposed by section 11 or subchapter L of chapter 1, whichever is applicable, plus

(ii)the tax imposed by section 55, plus

(iii)the tax imposed by section 59A, over

(B)the credits against tax provided by part IV of subchapter A of chapter 1.

(2)The amount of an adjustment under this section is equal to the excess of—

(A)the estimated income tax paid by the corporation during the taxable year, over

(B)the amount which, at the time of filing the application, the corporation estimates as its income tax liability for the taxable year.

(d)Consolidated returns If the corporation seeking an adjustment under this section paid its estimated income tax on a consolidated basis or expects to make a consolidated return for the taxable year, this section shall apply only to such extent and subject to such conditions, limitations, and exceptions as the Secretary may by regulations prescribe.

(Added Pub. L. 90–364, title I, § 103(d)(1), June 28, 1968, 82 Stat. 262; amended Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 99–499, title V, § 516(b)(4)(C), Oct. 17, 1986, 100 Stat. 1771; Pub. L. 99–514, title VII, § 701(d)(2), Oct. 22, 1986, 100 Stat. 2342; Pub. L. 100–203, title X, § 10301(b)(4), Dec. 22, 1987, 101 Stat. 1330–429; Pub. L. 113–295, div. A, title II, § 221(a)(12)(J), Dec. 19, 2014, 128 Stat. 4039; Pub. L. 114–41, title II, § 2006(a)(2)(E), July 31, 2015, 129 Stat. 457;

Pub. L. 115–97, title I, §§ 12001(b)(17), 13001(b)(2)(P), 14401(d)(3), Dec. 22, 2017, 131 Stat. 2094, 2097, 2233; Pub. L. 115–141, div. U, title IV, § 401(a)(293), Mar. 23, 2018, 132 Stat. 1198; Pub. L. 117–169, title I, § 10101(a)(4)(F), Aug. 16, 2022, 136 Stat. 1822.)

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