TP claimed a refund for an overpayment of corporate income taxes that were offset against a prior tax liability of penalty & interest for late estimated payments. TP argued that the penalty & interest was not due under the provisions of Section 3001(d) of the Revenue Reconciliation Act waiving penalties under IRC Section 6655. TP also argued that the department had no authority to offset their refund since the tax liability had not been assessed. Held that federal law does not govern imposition of penalty and interest under state law and that offset was authorized by Tax Administration Act. Protest denied.