Edsel:
Sure, why not try that strategy? Posting it as a refund carried forward to the next year, maybe, just maybe, something gets resolved. Not much else works.
And yes, the IRS and other taxing authorities are clearly processing paperwork for balance dues instead of for refunds. And if those refunds are applied to later years, the problems start to snowball. I have started to NOT apply refunds forward for many clients that make estimated payments, because of IRS's and others ability to process a refund correctly, because once there is a problem, it takes 2 years to fix and blows up other years.
Rich