Collapse to view only § 4962. Abatement of first tier taxes in certain cases
- § 4961. Abatement of second tier taxes where there is correction
- § 4962. Abatement of first tier taxes in certain cases
- § 4963. Definitions
§ 4961. Abatement of second tier taxes where there is correction
(a) General rule
(b) Supplemental proceeding
(c) Suspension of period of collection for second tier tax
(1) Proceeding in District Court or United States Court of Federal Claims
(2) Suit must be brought to determine liability
(3) Suspension of running of period of limitations on collection
(4) Jeopardy collection
(Added Pub. L. 96–596, § 2(c)(1), Dec. 24, 1980, 94 Stat. 3472; amended Pub. L. 99–514, title XVIII, § 1899A(50), Oct. 22, 1986, 100 Stat. 2961; Pub. L. 115–141, div. U, title IV, § 401(a)(325)(C), Mar. 23, 2018, 132 Stat. 1200.)
§ 4962. Abatement of first tier taxes in certain cases
(a) General rule
If it is established to the satisfaction of the Secretary that—
(1) a taxable event was due to reasonable cause and not to willful neglect, and
(2) such event was corrected within the correction period for such event,
then any qualified first tier tax imposed with respect to such event (including interest) shall not be assessed and, if assessed, the assessment shall be abated and, if collected, shall be credited or refunded as an overpayment.
(b) Qualified first tier tax
(c) Special rule for tax on political expenditures of section 501(c)(3) organizations
(Added Pub. L. 98–369, div. A, title III, § 305(a), July 18, 1984, 98 Stat. 783; amended Pub. L. 100–203, title X, § 10712(b)(1), (2), (4), Dec. 22, 1987, 101 Stat. 1330–467; Pub. L. 105–34, title XVI, § 1603(a), Aug. 5, 1997, 111 Stat. 1096; Pub. L. 110–172, § 3(h), Dec. 29, 2007, 121 Stat. 2475.)
§ 4963. Definitions
(a) First tier tax
(b) Second tier tax
(c) Taxable event
(d) Correct
For purposes of this subchapter—
(1) In general
(2) Special rules
The term “correct” means—
(A) in the case of the second tier tax imposed by section 4942(b), reducing the amount of the undistributed income to zero,
(B) in the case of the second tier tax imposed by section 4943(b), reducing the amount of the excess business holdings to zero, and
(C) in the case of the second tier tax imposed by section 4944, removing the investment from jeopardy.
(e) Correction period
For purposes of this subchapter—
(1) In general
The term “correction period” means, with respect to any taxable event, the period beginning on the date on which such event occurs and ending 90 days after the date of mailing under section 6212 of a notice of deficiency with respect to the second tier tax imposed on such taxable event, extended by—
(A) any period in which a deficiency cannot be assessed under section 6213(a) (determined without regard to the last sentence of section 4961(b)), and
(B) any other period which the Secretary determines is reasonable and necessary to bring about correction of the taxable event.
(2) Special rules for when taxable event occurs
For purposes of paragraph (1), the taxable event shall be treated as occurring—
(A) in the case of section 4942, on the first day of the taxable year for which there was a failure to distribute income,
(B) in the case of section 4943, on the first day on which there are excess business holdings,
(C) in the case of section 4971, on the last day of the plan year in which there is an accumulated funding deficiency, and
(D) in any other case, the date on which such event occurred.
(Added Pub. L. 96–596, § 2(c)(1), Dec. 24, 1980, 94 Stat. 3473, § 4962; renumbered § 4963, Pub. L. 98–369, div. A, title III, § 305(a), July 18, 1984, 98 Stat. 783; amended Pub. L. 100–203, title X, § 10712(b)(3), Dec. 22, 1987, 101 Stat. 1330–467; Pub. L. 104–168, title XIII, § 1311(c)(2), July 30, 1996, 110 Stat. 1478; Pub. L. 109–280, title XII, § 1231(b)(1), Aug. 17, 2006, 120 Stat. 1098.)