- 20 -
they have established that the deficiency notice was issued
beyond the normally applicable statute of limitations. The
burden of showing, by a preponderance of the evidence, that the
merged amount is properly includable in petitioners' gross income
for 1986 is on respondent.
Respondent has conceded in her briefs that, but for the
doctrine of judicial estoppel, the merged amount is properly
taxable in 1987, the year of distribution. We have accepted
respondent's concession, for the reasons described above. We
hold that respondent has failed to make the showing necessary to
avail herself of the 6-year statute of limitations.
Consequently, petitioners' 1986 individual Federal income tax
return is not open for redetermination. Therefore, we need not
consider the remaining issues.
We are aware that petitioners will escape taxation of the
contributions made on their behalf in 1986 and on the merged
amount. However, this result is a consequence of respondent's
failure to issue a deficiency notice before the limitations
period ran.
To reflect the foregoing,
Decision will be entered
for petitioners.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Last modified: May 25, 2011