Santa Fe, N.M. (Sept. 7, 2004) -- The state Court of Appeals here has reportedly ruled against actor Val Kilmer and his ex-wife, actress Joanne Whalley, in a dispute over a tax refund of more than $300,000 sought by the couple.

The couple claimed that they were owed a refund for $304,217 in personal income taxes paid for the year 1995 because Whalley -- who had filed for divorce -- had moved to California in the latter part of the year, the Associated Press reported. Kilmer has a ranch near Santa Fe.

The court said that the Taxation and Revenue Department had no authority to act on the refund claim because the time period for doing so had expired, AP said.

The claim was filed at the end of 1999, after California tax officials made a preliminary determination that Whalley had been a California resident as of August 1995. An amended 1995 New Mexico return claiming the refund filed by the couple's accountant wasn't processed because the department lost it, according to the report. In addition, the agency reportedly decided in early 2000 to delay work on prior-year claims for three months while it caught up with processing the current returns.

According to the report, under state law, if the department doesn't approve or deny a claim within 120 days, taxpayers then have 90 days to either file a protest or go to court. Kilmer and Whalley did neither. The court said that the 210-day window for the department to act on a claim expired, upholding a department hearing officer's ruling.

The court held that the legislature "intended a clear and definite outer limit, of 210 days, on the department's authority to act on a claim for refund," and rejected the claim that the couple's accountant had been misled in conversations with department employees, AP reported.

-- WebCPA staff

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access