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This technique is mostly referred to as "collaring". This is very handy to avoid batter over spills in your oven if you accidentally fill your cake pan to full. It can also be used to create a much deeper cake that what your cake pan allows. In this demonstration I have used a 6" x 2" cake pan.
Grease and flour your cake pan as normal.
DO NOT USE WAX PAPER FOR THIS TECHNIQUE
Cut your parchment paper to a length that is a few inches greater than the circumfrance of your pan.
Example: If you have a 6" Cake pan, cut your parchment paper to 8" in length.
The point is you want it to overlap in the next step.
Create a "Collar" by wrapping the parchement paper to the inside of your cake pan.
The fill with batter as you normally would.!
TIP 1: The parchment usually does not want to stick to the edge of your cake pan, making it very difficult to get your batter in there. I usually take a small dab of the batter on my finger and wipe it on the edge of the cake pan, and the parchment should adhere to that. I also add a dab to the parment where it overlaps to keep it in place.
TIP 2 : Use a heating core! The deeper your cake is, the longer it has to cook in order to fully cook the middle. Also make sure you add extra baking time.
For the purpose of this demonstration I have used an extremely tall collar, however I do not reccommend using one this high. 2 inches or so above your cake pan’s edge will suffice.