U.S. Court of Federal Claims Upholds Taxpayers’ Extension Request Despite Underestimated Gross Liability

The U.S. Court of Federal Claims upheld the taxpayers’ request for an automatic six-month extension to file their 2016 federal tax return, which was valid because they provided a reasonable estimate of their tax liability despite technically underestimating their gross liability, granting the taxpayers’ cross-motion for summary judgment and denying the government’s motion for summary judgment. Taxpayers, a retired married couple, had consistently overpaid their taxes from 2013 to 2016 and elected to carry forward each overpayment to the following tax year. For 2016, Taxpayers submitted Form 4868 estimating zero tax liability based on their substantial 2015 overpayment that would ...