Kristine A. Cluck - Page 1

          105 T.C. No. 21                                                             

                               UNITED STATES TAX COURT                                

                          KRISTINE A. CLUCK, Petitioner v.                            
                   COMMISSIONER OF INTERNAL REVENUE, Respondent                       

               Docket No. 18590-91.              Filed October 30, 1995.              

                    P is married to E.  E is not a petitioner in this case.           
               E's mother, M, died in 1983, leaving E and his brothers a              
               tract of land (G).  G was sold in 1984.  P and E have filed            
               joint Federal income tax returns since 1986.  P and E                  
          claimed net operating loss (NOL) deductions on their 1987 and               
          1988 returns, consisting of unused NOL's carried forward    from            
          E's 1983, 1984, and 1985 returns and from P and E's    1986 joint           
          return.  In 1989, after a dispute with R     regarding the value            
          of G for purposes of M's estate's Federal estate tax liability,             
          E and his brothers, who each had owned a one-fourth interest in             
          G, entered into an agreement with R.  Pursuant to the agreement,            
          G was valued at $1,420,000.  R disallowed the 1984 portion of               
          the 1987 and 1988 NOL's on the ground that E had unreported                 
          income    from the sale of G in 1984, sufficient to eliminate the           
          1984      loss.  P argued that E did not have unreported income             
          in 1984 because E's basis in G was $625,000, which exceeded his             
               amount realized ($619,425).  R argued that P was estopped by           
               the duty of consistency from arguing that E's basis was                

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