C. "Pass-through entity" means a corporation that for the applicable tax year is treated as an S corporation under the Code, and a general partnership, limited partnership, limited liability partnership, trust, limited liability company or similar entity that for the applicable tax year is not taxed as a C corporation for federal tax purposes. For purposes of this section, "pass-through entity" does not include a financial institution subject to tax under chapter 819.

Sec. 25. 36 MRSA §5276, sub-§1, as amended by PL 1991, c. 546, §36, is further amended to read:

1. General rule. The State Tax Assessor, within the applicable period of limitations, may credit an overpayment of income tax, including an overpayment reported on a joint return, and interest on such the overpayment against any liability arising from a redetermination pursuant to section 6211 or any liability in respect of any tax imposed under this Title on owed by the taxpayer, or by the taxpayer's spouse in the case of a joint return, who made the overpayment, and the. The balance, after any setoff pursuant to section 5276-A, must be refunded by the Treasurer of State.

Sec. 26. 36 MRSA §5276, sub-§6 is enacted to read:

6.__Overpayment by pass-through entity.__If there has been an overpayment of tax required to be withheld under section 5250-B, refund must be made to the pass-through entity only to the extent that the amount of the overpayment was not deducted and withheld by the pass-through entity.

Sec. 27. 36 MRSA §6211, as enacted by PL 1987, c. 516, §§3 and 6, is amended to read:

§6211. Audit of claim

If, on the audit of any claim filed under this chapter, the State Tax Assessor determines the amount to have been incorrectly determined, he the assessor shall redetermine the claim and shall notify the claimant of the redetermination and his the reasons for it. The redetermination shall be final unless appealed to the State Tax Assessor within 30 days of notice is reviewable in accordance with section 151. If the claim has been paid, the amount paid in excess of that legally due is subject to interest at the rate determined pursuant to section 186.__The assessor may