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unit. Petitioner elected to be taxed not on her individual
earnings and deductions (a treatment she could have chosen) but
on the income and deductions of both spouses. Her tax liability
is therefore directly affected by her husband's stipulation in
the Estate case, agreeing to the value of the Grapevine property.
Petitioner's husband (not she) was the one who allegedly incurred
the loss. If the loss is unavailable to him as a carryforward,
then it stands to reason that she is no more entitled to the loss
than he is. Under these circumstances, we hold that petitioner
is bound by the representations contained in that agreement.
The remaining two elements of the duty of consistency
standard are met. Respondent was bound to follow the stipulation
of settled issues, creating the necessary reliance by respondent.
The third prong is met because petitioner is maintaining a
position in this case which is inconsistent with the stipulation
of settled issues, to respondent's detriment. Since all three
elements of the duty of consistency are satisfied, we hold that
petitioner is bound to use $355,000 as Elwood's basis in the
Grapevine property for purposes of determining the amount of gain
he realized on the sale of such property.
We decline petitioner's invitation to redetermine the fair
market value of the Grapevine property as of the date of Martha
Cluck's death in 1983. We will not disturb the agreement between
respondent and Elwood, and we will not reexamine the stale
evidence regarding the 1983 value of the Grapevine property. See
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