Rev. Rul. 79-284

FACTS

Rev. Rul. 73-305, 1973-2 C.B. 43, holds that partial payments of assessed tax, penalty, and interest are to be applied as the taxpayer designates. If the taxpayer fails to give specific instructions as to the application of the partial payment voluntarily tendered, the amount of such payment will be applied by the Service to tax, penalty, and interest, in that order, for the earliest period, then to tax, penalty, and interest, in that order, for the next succeeding period, until the payment is absorbed. Rev. Rul. 73-305 further states, however, that it is not applicable to Alcohol, Tobacco and Firearms Taxes, withheld employment taxes and collected excise taxes.

HOLDING

Rev. Rul. 73-305 applies to withheld employment taxes and collected excise taxes where the taxpayer provides specific written instructions for the application of a voluntary partial payment. If no designation is made by the taxpayer, the Internal Revenue Service will allocate partial payments of withheld employment taxes and collected excise taxes to tax, penalty, or interest in a manner serving its best interest.

EFFECT ON OTHER DOCUMENTS

Rev. Rul. 73-305 is modified.