                   T.C. Memo. 2005-1



                UNITED STATES TAX COURT



             BARBARA DEATON, Petitioner v.
     COMMISSIONER OF INTERNAL REVENUE, Respondent

              RONNY DEATON, Petitioner v.
     COMMISSIONER OF INTERNAL REVENUE, Respondent



Docket Nos. 12375-01L, 11121-02L.   Filed January 3, 2005.


     In April 1994, Ps filed a request to extend the
time for filing their 1993 Federal income tax return
and remitted $125,000 therewith. Ps did not file their
1993 return until Jan. 10, 2000, reporting an
overpayment of $50,221 thereon. On their 1994-96
returns (also filed on Jan. 10, 2000), Ps sought to
apply that overpayment to their 1994-96 tax
liabilities. R did not honor Ps’ request, on the
ground that the amount Ps sought to so apply had been
“paid” in April 1994, which is outside the “lookback”
period of sec. 6511(b)(2)(A), I.R.C., that is
applicable to Ps’ Jan. 2000 request for credit. R
subsequently issued a Notice of Intent to Levy with
respect to Ps’ 1994-96 taxable years, and Ps timely
requested a collection due process hearing. R’s
Appeals Office sustained the proposed levy and issued a
Notice of Determination to that effect to each of P-H
and P-W.
                               - 2 -

          1. Held: R’s Appeals Office’s determinations that Ps’
     April 1994 remittance was a payment rather than a deposit
     and that the amount Ps sought to apply to their post-1993
     tax liabilities therefore had been paid outside the
     “lookback” period of sec. 6511(b)(2)(A), I.R.C., that is
     applicable to Ps’ Jan. 2000 request for credit are
     sustained.

          2. Held, further, R’s Appeals Office’s
     determination to allow the proposed levy to proceed is
     sustained.



     Lawrence R. Jones, Jr., for petitioners.

     Marty J. Dama, for respondent.



                        MEMORANDUM OPINION

     HALPERN, Judge:   These cases are before the Court to review

determinations made by respondent’s Appeals Office (Appeals) that

respondent may proceed to collect by levy unpaid income taxes

assessed against petitioners for 1994, 1995, and 1996.1   We

review those determinations pursuant to section 6330(d)(1).2




     1
        Petitioners are husband and wife who made joint returns
of income for the years in issue and for 1993. Due to petitioner
husband’s bankruptcy, respondent made separate determinations to
proceed with collection with respect to each petitioner, and each
petitioner filed a separate petition. We have consolidated the
two resulting cases. The issues and arguments are the same in
each case.
     2
        Unless otherwise indicated, all section references and
references to the Code are to the Internal Revenue Code of 1986,
as amended, and all Rule references are to the Tax Court Rules of
Practice and Procedure.
                               - 3 -

     Each petitioner’s sole assignment of error is that Appeals

erroneously characterized the remittance accompanying their

filing extension request for 1993 as a payment rather than a

deposit, thereby precluding, by operation of section

6511(b)(2)(A), the use of the overpayment attributable to that

remittance as a credit against their 1994-96 tax liabilities.

                            Background

     The parties filed a stipulation of facts and submitted these

cases without trial pursuant to Rule 122.   The stipulation of

facts, with accompanying exhibits, is incorporated herein by this

reference.   Petitioners resided in Winnsboro, Texas, at the time

the petitions were filed.

     On or about April 15, 1994, petitioners filed Form 4868,

Application for Automatic Extension of Time to File U.S.

Individual Income Tax Return, with respect to their joint Federal

income tax return for 1993 (the 1993 Form 4868).   The signature

of “Tommy J. Chambers C.P.A.” appears on the preparer’s signature

line of the 1993 Form 4868, along with a request that any

correspondence regarding the application be sent to Gollob,

Morgan, Peddy & Co. P.C. in Tyler, Texas.   As required by the

form, petitioners listed an expected tax liability for 1993 of

$138,883 on the 1993 Form 4868.   Petitioners also listed $13,883

of withholding for 1993 (1993 withholding) on the form, resulting

in a “balance due” of $125,000.   Although the form did not
                               - 4 -

require a remittance of the balance due (as so computed) as a

condition to obtaining the extension, petitioners submitted a

check in the amount of $125,000 with the 1993 Form 4868 (the 1994

remittance).   Petitioners made no additional remittances in

respect of their 1993 tax liability.

     Petitioners did not file their 1993 Federal income tax

return (the 1993 return) until January 10, 2000.   On the 1993

return, petitioners reported tax of $88,662, total payments of

$138,883 (consisting of the $13,883 of 1993 withholding and the

$125,000 1994 remittance), and an overpayment of $50,221.

     Petitioners also filed their 1994-96 Federal income tax

returns (the 1994, 1995, and 1996 returns, respectively) on

January 10, 2000.   On the 1994 return, petitioners treated the

$50,221 overpayment reported on the 1993 return as a payment in

respect of their 1994 tax liability.   On the 1995 return,

petitioners treated the remaining balance of that overpayment

(i.e., the amount of the overpayment for 1993 remaining after

application thereof to their 1994 tax liability) as a payment in

respect of their 1995 tax liability.   On the 1996 return,

petitioners treated the remaining balance of the overpayment

(i.e., the amount of the overpayment for 1993 remaining after

application thereof to their 1994 and 1995 tax liabilities) as a

payment in respect of their 1996 tax liability and requested that

the resulting excess amount be applied to their 1997 tax
                                - 5 -

liability.

     Shortly after receiving the 1993-96 returns in January 2000,

respondent assessed the amounts reported as tax on those returns,

applied the 1993 withholding ($13,883) and the 1994 remittance

($125,000) to the 1993 assessment ($88,662), and, contrary to

petitioners’ instructions as expressed in their 1994-96 returns,

posted the remaining amount ($50,221) to “excess collections”.

     On August 3, 2000, respondent issued to petitioners a Notice

of Intent to Levy with respect to their 1994-96 taxable years.

Petitioners timely filed Form 12153, Request for a Collection Due

Process Hearing, with an attached letter from their C.P.A.

explaining their position (the C.P.A. letter).    The C.P.A. letter

bears the letterhead of Mike Wellman, C.P.A., with an address in

Longview, Texas.3    The sole argument raised in the C.P.A. letter

in opposition to the proposed levy is that, contrary to what

petitioners understood respondent’s position to be, the 1994

remittance was a deposit rather than a payment.    If accepted,

that argument would have the effect of negating the applicability

of section 6511(b)(2)(A), the provision which precludes the

refund or credit of any amount “paid” more than 3 years (plus the

period of any filing extension) prior to the date such credit or

refund is claimed.

     3
        Mr. Wellman’s signature also appears on the preparer’s
signature line on each of the 1993-96 returns filed in January
2000, with the same address that appears on the C.P.A. letter.
                              - 6 -

     In support of petitioners’ argument, the C.P.A. letter

describes their factual situation as follows:

     In 1993, the taxpayer’s [sic] sold their business. At
     the time they sold it, they had no idea what their
     basis in it was, much less the tax that might be due.
     Furthermore, even before the return was due, they were
     engaged in a lawsuit with the purchaser regarding the
     “non-compete” portion of the contract for sale. It
     appeared that the ultimate outcome could result in the
     entire sale being voided. Not knowing what tax might
     be due, or even if any tax would be due, the taxpayers
     made a $125,000 payment with their extension in April
     1994. This payment was not based on any estimate of
     the tax liability. It was made so that any interest
     and penalties could be avoided when the ultimate tax
     was calculated. It was very much akin to a pre-payment
     of a proposed examination assessment – except that they
     had NO idea the amount of the tax that may be due.

     Like many lawsuits, this one remained in the courts for
     many years. It was not until late 1998 that the Texas
     Supreme Court finally decided the case in favor of the
     taxpayers. Since so much time had passed, and due to
     poor record keeping and numerous other complicated
     transactions during 1993, it was not until late 1999
     that the 1993 return could be completed. It was not
     until the return was completed that the tax liability
     was actually known. Until then, it did not even rise
     to the level of a wild guess. It was simply a deposit
     to avoid interest and penalties.

     Appeals sustained the proposed levy, rejecting petitioners’

argument that they intended the 1994 remittance to constitute a

deposit rather than a payment of tax.   As previously stated,

petitioners’ sole assignment of error is that Appeals erroneously

characterized the 1994 remittance as a payment rather than a

deposit.
                                   - 7 -

                                 Discussion

I.   Law

      A.    Collection Due Process

      Section 6330(a) provides that the Commissioner must notify a

taxpayer of his right to request a hearing before the

Commissioner may collect unpaid Federal taxes from such taxpayer

by levy.     If the taxpayer requests such a hearing, the Appeals

officer conducting the hearing must verify that the requirements

of any applicable law or administrative procedure have been met.

Sec. 6330(c)(1).     The taxpayer requesting the hearing may raise

“any relevant issue relating to the unpaid tax or the proposed

levy”.     Sec. 6330(c)(2)(A).    The taxpayer “may also raise at the

hearing challenges to the existence or amount of the underlying

tax liability” if the taxpayer did not receive any statutory

notice of deficiency for, or did not otherwise have an

opportunity to dispute, such tax liability.      Sec. 6330(c)(2)(B).

      Following the hearing, the Appeals officer must determine

whether the proposed levy is to proceed, taking into account the

verification the Appeals officer has made, the issues raised by

the taxpayer at the hearing, and whether the proposed levy

“balances the need for the efficient collection of taxes with the

legitimate concern of the * * * [taxpayer] that any collection

action be no more intrusive than necessary.”      Sec. 6330(c)(3).

We have jurisdiction to review such determinations where we have
                                  - 8 -

jurisdiction over the type of tax involved in the case.    Sec.

6330(d)(1)(A); see Iannone v. Commissioner, 122 T.C. 287, 290

(2004).   Where the underlying tax liability is properly at issue,

we review the determination on a de novo basis.     E.g., Goza v.

Commissioner, 114 T.C. 176, 181-182 (2000).     Where the underlying

tax liability is not properly at issue, we review the

determination for abuse of discretion.      Id. at 182.

     B.   Credit or Refund of Overpayment

           1.   Code Provisions

     Section 6402(a) provides generally that the Secretary may,

within the applicable period of limitations, credit a taxpayer’s

overpayment against any other Federal tax liability of that

taxpayer and refund any remaining balance.

     Section 6511(a) provides that the general period of

limitations for filing a claim for credit or refund ends (1) 3

years after the filing of the return in question, or (2) 2 years

after the payment of the tax, whichever period expires later.

Under the “lookback” rule of section 6511(b)(2)(A), if the claim

is filed within the 3-year period of limitations, the amount of

the credit or refund is limited to the amount of tax paid by the

claimant during the 3-year period immediately preceding the

filing of the claim, extended by any period of extension for

filing the return in question.
                                - 9 -


          2.    Judicially Created Distinction Between Payments and
                Deposits

          a.    In General

          i.    Rosenman v. United States

     In Rosenman v. United States, 323 U.S. 658 (1945), the

Supreme Court recognized that not all taxpayer remittances to the

Internal Revenue Service (IRS) constitute “payments” of tax.       In

the context of the “lookback” rule of the predecessor of section

6511(b)(2), the Court held that the remittance before it, made in

connection with the procurement of a 2-month extension for filing

an estate tax return, was in the nature of a deposit that

attained “payment” status only as the Commissioner applied it in

satisfaction of subsequently assessed amounts.       Id. at 662.

Notably, the transmittal letter accompanying the remittance

stated in part as follows:   “This payment is made under protest

and duress, and solely for the purpose of avoiding penalties and

interest, since it is contended by the executors that not all of

this sum is legally or lawfully due.”       Id. at 660-661.

          ii.   Judicial Interpretations of Rosenman

     Most lower courts, including this Court, have interpreted

Rosenman v. United States, supra, as sanctioning a facts and

circumstances approach to determining whether a remittance in

respect of a tax is a payment of tax or a deposit, at least in

situations where the Code is silent on the issue.      E.g., Ertman

v. United States, 165 F.3d 204, 206-207 (2d Cir. 1999); Ott v.
                              - 10 -

United States, 141 F.3d 1306, 1308 (9th Cir. 1998); Risman v.

Commissioner, 100 T.C. 191, 197-198 (1993) (all discussing

Rosenman progeny).   Under that approach, courts generally seek to

determine whether, based on all of the relevant facts and

circumstances associated with the remittance, the remitter

intended the remittance to satisfy what he or she regarded as an

existing tax liability.   See, e.g., Risman v. Commissioner, supra

at 197 (and cases cited therein).   Such intent is generally

considered to be lacking in the case of a random remittance

(e.g., one made without reference to a return and prior to any

IRS audit4) of an amount that bears no good faith relationship to

the remitter’s reasonably possible ultimate tax liability.     See

id. at 198.

     In contrast to the foregoing, the Court of Appeals for the

Fifth Circuit (to which an appeal in these cases likely would go)

interpreted Rosenman v. United States, supra, as establishing a

generally applicable rule that a remittance in respect of a tax

cannot become a “payment” of that tax for purposes of section

6511 until the Commissioner assesses the tax in question.    See

Thomas v. Mercantile Natl. Bank, 204 F.2d 943, 944 (5th Cir.

1953); see also Ford v. United States, 618 F.2d 357, 359 (5th

Cir. 1980) (following Thomas); Harden v. United States, 76 AFTR


     4
        The Commissioner has published guidelines for taxpayers
seeking to make deposits in the audit context in Rev. Proc. 84-
58, 1984-2 C.B. 501.
                                 - 11 -

2d 95-7980, 96-1 USTC par. 50,088 (5th Cir. 1995) (following

Thomas and Ford).

            iii.   Baral v. United States

     In Baral v. United States, 528 U.S. 431, 437-438 (2000), a

section 6511 case involving income tax withholding and a

remittance of estimated tax, the Supreme Court rejected the

interpretation of Rosenman v. United States, supra, by the Court

of Appeals for the Fifth Circuit as being at odds with the plain

language of section 6513(b)(1) and (2).      Section 6513(b)(2)

provides that, for purposes of section 6511 or 6512,5 remittances

of estimated income tax in respect of a taxable year are deemed

paid on the deadline (determined without regard to extensions)

for filing that year’s return.     Section 6513(b)(1) contains a

similar rule for income tax withholding.      In a footnote, the

Court stated:      “We need not address the proper treatment under §

6511 of remittances that, unlike withholding and estimated income

tax, are not governed by a ‘deemed paid’ provision akin to §

6513(b).”    Baral v. United States, supra at 439 n.2.    Thus, in

the context of remittances not described in section 6513(b), the

facts and circumstances approach to distinguishing between

payments and deposits, as developed under Rosenman and its

progeny, retains its viability.     See VanCanagan v. United States,


     5
        Sec. 6512(b) contains rules relating to overpayment
determinations by the Tax Court. Sec. 6512(b)(3) provides
“lookback” rules in part by reference to sec. 6511(b)(2).
                               - 12 -

231 F.3d 1349, 1352-1353 (Fed. Cir. 2000) (discussing Rosenman

and Baral).

     The Court of Appeals for the Fifth Circuit has not, since

Baral, addressed the payment/deposit distinction.

          b.    Form 4868 Remittances

          i.    Background

     Section 6081(a) authorizes the Secretary to grant extensions

of time to file tax returns.   Regulations promulgated under

section 6081 provide that an individual can obtain an automatic

4-month extension of time for filing his or her income tax return

by filing Form 4868, Application for Automatic Extension of Time

to File U.S. Individual Income Tax Return.   Sec. 1.6081-4(a),

Income Tax Regs.   Such an application must show “the full amount

properly estimated as tax” for the taxable year.    Sec. 1.6081-

4(a)(4), Income Tax Regs.6

          ii.    Risman v. Commissioner

     In Risman v. Commissioner, supra, a case involving section

6512(b)(3), we rejected the Commissioner’s argument that a

remittance accompanying Form 4868 (Form 4868 remittance) is an

“amount paid as estimated income tax” within the meaning of


     6
        Prior to its amendment in 1996, that regulation also
required applicants to remit the “balance due” shown on Form 4868
in order to obtain an extension. The IRS, however, eliminated
that requirement for 1992 and subsequent taxable years in Notice
93-22, 1993-1 C.B. 305, 306. See also T.D. 8651, 1996-1 C.B.
312, 313 (individuals may rely on Notice 93-22 for taxable years
ending on or after Dec. 31, 1992, and before Dec. 31, 1995).
                                - 13 -

section 6513(b)(2), which, by virtue of that status, constitutes

a payment as a matter of law.    In so doing, we declined to follow

England v. United States, 760 F. Supp. 186 (D. Kan. 1991), and

Batton v. United States, 60 AFTR 2d 87-5983, 87-2 USTC par. 9622

(D. Md. 1987), in which the respective courts accepted that

argument based on the reference to “amount properly estimated as

tax” in section 1.6081-4(a)(4), Income Tax Regs.7   In particular,

we stated:

     We conclude that the language “amount properly
     estimated as tax” under section 1.6081-4(a)(4), Income
     Tax Regs., is not synonymous with, nor covered by, the
     language regarding estimated tax payments under
     sections 6015[8] and 6513(b)(2). The operative
     provision, therefore, of section 6513(b)(2) (that deems
     any and all payments of estimated taxes as paid, as a
     matter of law, as of the due date of the related income
     tax returns) is not applicable to petitioners’
     remittance under section 1.6081-4(a)(4), Income Tax
     Regs., of the $25,000 submitted with petitioners’ Form
     4868 extension request.

Risman v. Commissioner, supra at 202.    We looked instead to the


     7
        In an earlier case, the Court of Appeals for the Tenth
Circuit had concluded, without specific reference to the language
of sec. 1.6081-4(a)(4), Income Tax Regs., that sec. 6513(b)(2)
applied to the Form 4868 remittance at issue in that case.
Weigand v. United States, 760 F.2d 1072, 1074 (10th Cir. 1985).
We construed Weigand as assuming, without holding, that a Form
4868 remittance is a payment of estimated income tax within the
purview of sec. 6513(b)(2). Risman v. Commissioner, 100 T.C.
191, 200 n.4 (1993). The district court in England v. United
States, 760 F. Supp. 186 (D. Kan. 1991) (which was appealable to
the Tenth Circuit) apparently had reached the same conclusion, as
it did not rely on Weigand in its analysis.
     8
        Former sec. 6015 required individuals in certain
circumstances to file annual declarations of estimated income
tax.
                               - 14 -

facts and circumstances of the case in concluding that the Form

4868 remittance at issue constituted a deposit rather than a

payment.   Id. at 203.

     We based our rejection of the Batton/England analysis in

part on other statutory language indicating that remittances of

“estimated income tax” as contemplated in section 6513(b)(2) “are

something quite different from taxpayers’ remittances of the

total ‘amount properly estimated as tax’ in requesting extensions

of time to file income tax returns under section 6081.”    Risman

v. Commissioner, supra at 201.    For instance, we observed that

section 6015(d) (as in effect at the time of the taxpayers’

remittance) provided that, for all purposes of the Code, the term

“estimated tax” does not encompass the individual alternative

minimum tax (AMT).   Id.   Conversely, section 1.6081-4(a)(4),

Income Tax Regs., contains no such AMT carve-out for purposes of

determining the “amount properly estimated as tax” in the context

of obtaining a filing extension.9   Id.

     Since our report in Risman v. Commissioner, supra, four

Courts of Appeals have concluded, based at least in part on the

application of section 6513(b)(2), that a Form 4868 remittance is


     9
        We also cited language in sec. 6081(b) and former sec.
6152 (both as in effect at the time of the taxpayers’ remittance)
which, taken together, revealed a disconnect between a
corporation’s payment of an “amount properly estimated as its
tax” in the context of a filing extension request and its
“payment of estimated income tax” pursuant to former sec. 6154.
See Risman v. Commissioner, supra at 201-202.
                                 - 15 -

a payment as a matter of law for purposes of the “lookback” rules

of section 6511(b)(2).    Ertman v. United States, 165 F.3d 204 (2d

Cir. 1999); Dantzler v. United States, 183 F.3d 1247 (11th Cir.

1999); Ott v. United States, 141 F.3d 1306 (9th Cir. 1998);

Gabelman v. Commissioner, 86 F.3d 609 (6th Cir. 1996), affg. T.C.

Memo. 1993-592.10

II.   Arguments of the Parties

      A.   Respondent’s Argument

      Respondent’s principal argument is that, by operation of

section 6513(b)(2), petitioners’ 1994 remittance was a payment

(rather than a deposit) as a matter of law, with the result that,

pursuant to section 6511(b)(2)(A), the overpayment for 1993 is

not available as a credit against petitioners’ 1994-96 tax

liabilities.    In support of that argument, respondent contends

that our analysis in Risman v. Commissioner, 100 T.C. 191 (1993),

is obsolete in view of the fact that the additional statutory

language we examined therein had been repealed by the time

petitioners filed their 1993 Form 4868.    Respondent also points

to the “weight of authority” that is contrary to Risman.11

      10
        Although we reached the same result in Gabelman v.
Commissioner, T.C. Memo. 1993-592, affd. 86 F.3d 609 (6th Cir.
1996), as did the Court of Appeals for the Sixth Circuit on
appeal, we did so based on the facts and circumstances of the
case, consistent with Risman v. Commissioner, supra.
      11
        In addition to the four cases cited above, respondent
includes David v. United States, 80 AFTR 2d 97-8427, 98-1 USTC
                                                    (continued...)
                              - 16 -

     Alternatively, respondent contends that, even under a facts

and circumstances analysis, the 1994 remittance was a payment

rather than a deposit.   In that regard, respondent rejects

petitioners’ argument (discussed below) that the contemporaneous

view of the Court of Appeals for the Fifth Circuit regarding pre-

assessment remittances is relevant to these cases.

     B.   Petitioners’ Argument

     Petitioners argue that the proper characterization of a

remittance to the IRS as a payment of tax or a deposit depends on

the facts and circumstances associated with the remittance.

Moreover, petitioners argue that the facts and circumstances

surrounding the 1994 remittance establish their contemporaneous

intent to treat the remittance as a mere deposit rather than a

payment of tax.   On brief, petitioners focus primarily on the

fact that, when they made the 1994 remittance, they resided

within the geographic jurisdiction of a Court of Appeals which,

at that time, subscribed to the view that pre-assessment




     11
      (...continued)
par. 50,125 (1st Cir. 1997), and Weigand v. United States, supra,
among the Court of Appeals cases holding that Form 4868
remittances are payments as a matter of law. In David, 80 AFTR
2d at 8428, 8429, the Court of Appeals for the First Circuit
specifically declined to decide that issue, concluding instead
that, in the absence of any evidence to the contrary, the
taxpayer presumably intended his Form 4868 remittance to
discharge the liability in question, thereby rendering the
remittance a payment. Regarding the Weigand case, see supra note
7.
                                    - 17 -

remittances are deposits as a matter of law.         In petitioners’

words:

       Under the legal landscape in the Fifth Circuit at the
       time which was part of the facts and circumstances, any
       taxpayer remitting to the IRS knew that, barring some
       affirmative indication of payment prior to assessment,
       the remittance was a deposit. Petitioners’ remittance
       prior to assessment without any indication that the
       remittance be treated as a payment rather than a
       deposit should govern. [Fn. ref. omitted.]

             *         *       *       *       *       *       *

            Petitioners’ position is not the application of
       the “per se” rule that may indeed have been overruled
       in principle by Baral, but is simply the application of
       the facts and circumstances as Petitioners found them
       at the time in order to determine whether the objective
       circumstances indicated Petitioners’ intention to
       direct that the remittance be treated as a deposit.

III.    Analysis

        A.       Respondent’s Principal Argument

       In Risman v. Commissioner, supra, we considered and rejected

respondent’s argument that, by operation of section 6513(b)(2), a

Form 4868 remittance is a payment as a matter of law.        While the

emerging “weight of authority” contrary to Risman may, under the

appropriate circumstances, warrant a reconsideration of our

analysis therein, we do not undertake that exercise today.         We do

not do so because we can sustain respondent’s determination on

the basis of his alternative argument that, even under a facts

and circumstances analysis, the 1994 remittance was a payment

rather than a deposit.         See VanCanagan v. United States, 231 F.3d

at 1352-1353.         Any comprehensive review of Risman must await the
                              - 18 -

day when it would make a difference in the outcome of a case

before us.

     Notwithstanding the foregoing, we do revisit Risman for the

limited purpose of addressing (and rejecting) respondent’s

technical argument that, due to the repeal of the additional

statutory language we examined in Risman, our analysis therein is

no longer viable.   Had our analysis rested solely on the specific

wording of those provisions (i.e., former sections 6015 and 6152

and section 6081(b), see supra part I.B.2.b.ii. and note 9),

respondent’s argument might have some force.12   However, quite

apart from our analysis of those provisions, we made the

following general observations:

          Initially, we note an obvious and significant
     difference between estimated tax payments * * * and a
     payment of the estimated total tax liability * * * with
     a Form 4868 extension request. Estimated tax is a form
     of prepaid tax which is submitted with a Form 1040-ES
     in quarterly installments throughout the taxable year *
     * *. By the statutory due date for the filing of a tax
     return (in this case April 15, 1982) and at the time a
     taxpayer attempts to estimate his or her total Federal
     income tax liability for purposes of obtaining an
     extension of time to file a tax return under section
     6081, the date for making estimated tax payments for
     the prior year * * * has expired.

Risman v. Commissioner, supra at 199; see also sec. 6654(b)(2)

(interest charge on calendar year taxpayer’s underpayment of a


     12
        Even if our analysis had been so limited, respondent
does not suggest that Congress repealed or amended those
provisions (in three separate pieces of legislation passed by
three different Congresses) in order to clarify the scope of sec.
6513(b)(2).
                                - 19 -

required installment of estimated tax ceases to accrue on April

15 of the following year).   Those observations in no way depend

on the subsequently repealed statutory language we examined in

Risman.

     B.   Facts and Circumstances Analysis

           1.   Relevance of Existing Fifth Circuit Precedent

     We first consider petitioners’ argument concerning the

“legal landscape in the Fifth Circuit”.   As a matter of logic,

the “legal landscape in the Fifth Circuit” can be probative of

petitioners’ intent regarding the 1994 remittance only if they

were aware of that precedent when they made the remittance.

Petitioners have made no allegation to that effect, either in

their administrative appeal or in connection with these

proceedings, nor does the record contain any evidence that would

support such an allegation.13   To the extent petitioners are

suggesting that we should legally presume their awareness of that

precedent for these purposes, they do not cite, nor are we aware

of, any authority for such a proposition.    We therefore conclude

that, absent any allegations or evidence that these petitioners

(as opposed to the generic “any taxpayer remitting to the IRS”



     13
        Assuming, arguendo, that the requisite intent could be
supplied by petitioners’ agents (e.g., the C.P.A. whose signature
appears on the 1993 Form 4868), petitioners have not alleged that
any such agent acted on the basis of, or was even aware of, the
Fifth Circuit position, nor does the record contain any evidence
that would support such an allegation.
                                 - 20 -

referenced in their brief) in fact “knew that, barring some

affirmative indication of payment prior to assessment, the

remittance was a deposit” under Fifth Circuit precedent at the

time, the existence of such precedent is not relevant to our

determination of petitioners’ intent with regard to the 1994

remittance.

          2.   Petitioners’ Failure To Develop the Record

     Petitioners apparently are content to rely solely on the

representations of Mr. Wellman contained in the C.P.A. letter to

establish their intent regarding the 1994 remittance.   There is

no indication in the record that petitioners provided Appeals

with any evidence that would corroborate those representations,

nor do petitioners allege that Appeals refused to consider any

such evidence.14   Furthermore, because petitioners chose (with

respondent’s acquiescence) to submit these cases without trial

pursuant to Rule 122, there is no pertinent evidence before us

that was not before Appeals.15

     Petitioners’ exclusive reliance on the C.P.A. letter is all

the more puzzling considering the source.   There is no indication


     14
        In her case memorandum for each petitioner, respondent’s
Appeals officer states that petitioners did not present any
documents to elaborate on the litigation involving the sale of
their business.
     15
        Accordingly, since we reach the same result as did
Appeals, our disposition of these cases does not depend on
whether we review Appeals’ determinations for abuse of discretion
or on a de novo basis.
                                - 21 -

in the record that Mr. Wellman, the author of that letter, was

involved in any way with the filing of the 1993 Form 4868 in

April 1994 or was otherwise involved in petitioners’ affairs at

that time.   Had petitioners gone to trial, they presumably could

have elicited the testimony of Mr. Chambers (the C.P.A. whose

signature appears on the 1993 Form 4868) regarding the

circumstances that allegedly rendered their 1993 tax liability

inestimable as of April 1994.    Because petitioners chose not to

do so, we may presume that such testimony would have been

unfavorable to them.    See, e.g., ASAT, Inc. v. Commissioner, 108

T.C. 147, 172 (1997) (citing Wichita Terminal Elevator Co. v.

Commissioner, 6 T.C. 1158, 1165 (1946), affd. 162 F.2d 513 (10th

Cir. 1947)).    Relying on the C.P.A. letter, petitioners have

failed to convince us that, as of April 1994, their 1993 tax

liability was inestimable and the 1994 remittance was intended as

a deposit.

           3.    Inconsistencies Between the C.P.A. Letter and
                 Petitioners’ 1993 Return

     Moreover, the C.P.A. letter itself does not square with

information from petitioners’ 1993 return contained in the

record.   For instance, the 1993 return belies the assertion in

the C.P.A. letter that petitioners’ ignorance of their 1993 tax

liability in April 1994 was attributable to the sale of their

business in, and “numerous other complicated transactions

during”, 1993.    The only sale referenced in the 1993 return is an
                               - 22 -

installment sale that occurred in 1990,16 and the 1993 return

hardly attests to the occurrence of “numerous other complicated

transactions” during 1993.17   Furthermore, the 1993 return belies

the allegations in the C.P.A. letter that the $125,000 amount of

the 1994 remittance “was not based on any estimate of the tax

liability” and “did not even rise to the level of a wild guess”

as to the amount of that liability.     Specifically, if one

calculates petitioners’ tentative 1993 tax without any basis

offset to the capital gain they reported for 1993 relating to the

1990 sale, but otherwise in accordance with the Schedule D tax

worksheet attached to the 1993 return, the resulting tentative

tax is approximately $125,000.

          4.   Risman Is Factually Distinguishable

     These cases are distinguishable from Risman v. Commissioner,

100 T.C. 191 (1993), in which we concluded, on the basis of the

facts and circumstances of that case, that the taxpayers’

remittance with their filing extension request was a deposit

rather than a payment.   In Risman v. Commissioner, supra at 193-

194, 198, the Commissioner initially treated the remittance as a



     16
        Petitioners reported on the 1993 return that they had
received almost $500,000 from that sale prior to 1993. The
record does not reflect whether petitioners experienced similar
difficulties calculating their 1990-92 tax liabilities.
     17
        Other than wages, interest, and gain from the 1990 sale,
the 1993 return lists “other income” of $600 and a $24,229
nonpassive loss from two S corporations.
                               - 23 -

deposit, and the taxpayers effectively confirmed their

understanding of that treatment in writing approximately 14

months later, well before the Commissioner recharacterized the

remittance as a payment in his records.18   In the instant case,

petitioners did not claim deposit status until approximately 6-

1/2 years after they made the 1994 remittance, and they did so

only in response to respondent’s commencement of collection

activity.19   Furthermore, in Risman v. Commissioner, supra at 198,

we found that the taxpayers arbitrarily chose the amount of the


     18
        The Commissioner apparently recharacterized the
remittance as a payment solely on the theory that it was a
payment as a matter of law. See Risman v. Commissioner, 100 T.C.
191, 198 (1993) (Commissioner did not dispute that, under a facts
and circumstances analysis, the remittance would be treated as a
deposit).
     19
        A more analogous case is VanCanagan v. United States,
231 F.3d 1349 (Fed. Cir. 2000). In that case, the taxpayers
sought to avoid dismissal of their refund suit on the strength of
an affidavit of the accountant who had prepared the Form 4868
accompanying the remittance at issue. In upholding the trial
court’s dismissal, the Court of Appeals for the Federal Circuit
stated:

     The accountant’s explanation of what he did and his
     characterization of the $150,000 remittance as a
     “deposit,” made more than 5 ½ years after the extension
     application was filed and the remittance made, is
     insufficient to raise any valid factual issue on
     whether the $150,000 remittance was a deposit.

Id. at 1354. While we do not suggest that the noncontemporaneous
statements of a taxpayer’s representative, standing alone, are
never sufficient to corroborate that taxpayer’s claimed intent
with regard to a remittance, we do submit that such statements
are particularly suspect where, as is apparently the case here,
the representative did not represent the taxpayer in connection
with the remittance.
                               - 24 -

remittance at issue.    As discussed above, petitioners’ 1993

return suggests that they did not randomly choose the amount of

the 1994 remittance.

           5.   Conclusion

      For the reasons discussed above, we sustain Appeals’

conclusion that petitioners failed to establish their alleged

intent that the 1994 remittance be regarded as a deposit rather

than a payment.

IV.   Conclusion

      We sustain Appeals’ findings (1) that the 1994 remittance

was a payment rather than a deposit, and (2) that, having been

paid outside the “lookback” period of section 6511(b)(2)(A), the

portion of the 1994 remittance in excess of petitioners’ 1993 tax

liability may not be credited against petitioners’ 1994-96 tax

liabilities.    As petitioners have made no other assignments of

error, we sustain Appeals’ determinations to allow the proposed

levy to proceed.

      To reflect the foregoing,

                                          Decisions will be entered

                                     for respondent.
