CH. 1—NORMAL TAXES AND SURTAXES
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PART II—MITIGATION OF EFFECT OF LIMITATIONS AND OTHER PROVISIONS Sec. Sec. Sec. Sec. Sec.
1311. 1312. 1313. 1314. 1315.
Correction of error. Circumstances of adjustment. Definitions. Amount and method of adjustment. Effective date.
SEC. 1311. CORRECTION OF ERROR. (a) GENERAL RULE. — I f a determination (as defined in section
1313) is described in one or more of the paragraphs of section 1312 and, on the date of the determination, correction of the effect of the error referred to in the appHcable paragraph of section 1312 is prevented by the operation of any law or rule of law, other than this part and other than section 7122 (relating to compromises), then the effect of the error shall be corrected by an adjustment made in the amount and in the manner specified in section 1314. (b) CONDITIONS NECESSARY FOR ADJUSTMENT.— (1) MAINTENANCE OF AN INCONSISTENT POSITION.—Except
in
cases described in paragraphs (3)(B) and (4) of section 1312, an adjustment shall be made under this part only if— (A) in case the amount of the adjustment would be credited or refunded in the same manner as an overpayment under section 1314, there is adopted in the determination a position maintained by the Secretary or his delegate, or (B) in case the amount of the adjustment would be assessed and collected in the same manner as a deficiency under section 1314, there is adopted in the determination a position maintained by the taxpayer with respect to whom the determination is made, and the position maintained by the Secretary or his delegate in the case described in subparagraph (A) or maintained by the taxpayer in the case described in subparagraph (B) is inconsistent with the erroneous inclusion, exclusion, omission, allowance, disallowance, recognition, or nonrecognition, as the case may be. (2) CORRECTION NOT BARRED AT TIME OF ERRONEOUS ACTION.— (A) DETERMINATION DESCRIBED IN SECTION 1312 (3)(B). —
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In the case of a determination described in section 1312(3)(B) (relating to certain exclusions from income), adjustment shall be made under this part only if assessment of a deficiency for the taxable year in which the item is includible or against the related taxpayer was not barred, by any law or rule of law, at the time the Secretary or his delegate first maintained, in a notice of deficiency "fent pursuant to section 6212 or before the Tax Court of the United States, that the item described in section 1312 (3)(B) should be included in the gross income of the taxpayer for the taxable year to which the determination relates. (B) DETERMINATION DESCRIBED IN SECTION 1312 (4).—In the case of a determination described in section 1312(4) (relating to disallowance of certain deductions and credits), adjustment shall be made under this part only if credit or refund of the overpayment attributable to the deduction or credit described in such section which should have been allowed to the taxpayer or related taxpayer was not barred, by any law or rule of law, at the time the taxpayer first maintained before the Secretary or his delegate or § 1311(b)(2)(B)
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