§1721a Adjustments and refunds

Summary

If a leaseholder or its agent finds it paid too much or too little, it must fix the mistake or ask for a refund within a six-year window that starts when the payment was due. Sending a royalty report that shows the mistake counts as telling the Secretary or the state in charge. When fixing a payment, the leaseholder must figure and report any interest that applies at the same time, unless doing that creates a hardship. If hardship exists, the Secretary or state will figure the interest and tell the leaseholder, unless the leaseholder chooses to calculate it. Fixes or refund requests after the six years are allowed only if the leaseholder gives written notice and the Secretary or state approves during an audit of the period that includes the month of production. If an audit finds an overpayment, the government must give a credit or refund for that amount. The six-year time period can be paused or changed the same way the time limit in section 1724 is. To ask for a refund, a person must send a written demand to the Secretary that names who should get the money, shows enough information to find the overpayment, and explains why it was an overpayment. The Secretary will tell the Treasury how much to pay. Refunds come from current receipts from sales, bonuses, royalties (including interest collected here), and rentals under the Mineral Leasing Act and the Outer Continental Shelf Lands Act, except amounts due to a State or the Reclamation Fund. Any part of a refund that was already paid to a State, the Reclamation Fund, or another legally prescribed recipient will be taken from that recipient’s next payment and put into Treasury miscellaneous receipts. The Secretary must pay or deny the refund (and explain the denial) within 120 days of getting the request. Refunds can be audited later and follow the rules in this chapter. The Secretary or a delegated State may not reduce or offset a refund or its interest by any debt the government cannot enforce under section 1724.