N.J.A.C. 18:2-2.10 - Credit for Erroneous Payments and Collections

(a) The Director may credit the erroneous overpayment of tax to the account of the taxpayer to offset the amount of a deficiency assessment, where it is determined as a result of the audit of any taxpayer that a State tax has been erroneously or illegally collected from such taxpayer, or has been paid by such taxpayer under a mistake of law or fact, and where no questions of law or fact are involved. Such offsets will be made with the following limitations:

1. Credit for the erroneous payment must be made within the time in which a deficiency assessment must be made for such tax as provided by law; and

2. Credit shall only be applied in order to offset a liability for a period which is covered by the applicable assessment period; and

3. Credit for erroneous overpayments shall only be made to offset a deficiency assessment made by the Director under the same state tax law.

(b) An audit of a taxpayer can only be initiated by the Division and not at the request of a taxpayer.