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Respondent’s Determinations of Deficiencies and Assessments
On March 24, 1995, respondent mailed to petitioners
statutory notices of deficiency (notices) determining the
deficiencies in, and additions to, tax that underlie the unpaid
assessments. Petitioners failed to petition the Tax Court in
response to the notices, and, as a result, respondent assessed
the deficiencies and additions to tax that he had determined.
Bankruptcy Case
On September 13, 1996, petitioners filed a voluntary
petition in bankruptcy under Chapter 13 of the Bankruptcy Code,
11 U.S.C. ch. 13 (“Adjustment of Debts of an Individual with
Regular Income”), in the United States Bankruptcy Court for the
Middle District of Georgia (the bankruptcy case and the
bankruptcy court, respectively). On October 21, 1996,
petitioners filed with the bankruptcy court both a Chapter 13
plan and a statement of financial affairs, which listed the
Internal Revenue Service (IRS) as a secured creditor with a total
claim of $338,571, of which $206,073 was listed as secured. On
October 22, 1996, the IRS filed a claim against petitioners
(called a “proof of claim” in bankruptcy parlance) for $428,780,
on the basis of unpaid taxes for 1982 through 1985, all of which
amount was listed as secured. On November 14, 1996, petitioners
filed an objection to the IRS’s proof of claim on the basis “that
the claim is not owed”, and, on November 15, 1996, petitioners
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Last modified: May 25, 2011