In any case when the United States Treasury Department determines that an overpayment of federal income tax exists and the person in whose favor the overpayment is determined is dead at the time the overpayment of tax is to be refunded, and notwithstanding whether the decedent had filed a joint and several or separate income tax return, the amount of the overpayment, if not in excess of $5,000, may be refunded as follows:

1. (a)
   Directly to the surviving spouse on his or her verified application; or
2. (b)
   If there is no surviving spouse, to one of the decedent’s children who is designated in a verified application purporting to be executed by all of the decedent’s children over the age of 14 years.

If a refund is made to the surviving spouse or designated child pursuant to the application, the refund shall operate as a complete discharge to the United States from liability from any action, claim, or demand by any beneficiary of the decedent or other person. This section shall be construed as establishing the ownership or rights of the payee in the refund.