Cascade Partnership, James M. and Margaret C. Costello, Tax Matters Partner - Page 8

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               Petitioner argues for a decision in its favor because the              
          FPAA was issued outside the normal 3-year period for assessment             
          because the consent to extend the assessment period was executed            
          by a person who was without capacity to do so.  More                        
          specifically, petitioner contends that under the applicable                 
          statutes and regulations Costello was not Cascade’s TMP,3 and he            
          was otherwise not authorized in writing by the partnership to               
          extend the assessment period.                                               
               Conversely, respondent argues that the consent was valid and           
          effective to extend the period for assessment to include the date           
          on which the FPAA was mailed.  More specifically, respondent                
          contends that under the partnership agreement and the law of the            
          State of Washington, Costello was authorized in writing to bind             
          the partnership to the consent extending the assessment period.             
          Addressing petitioner’s argument, respondent contends that even             
          if Costello was not an authorized TMP, petitioner should be                 
          equitably estopped from now denying that Costello lacked                    
          authority to execute the consent to extend the assessment period.           
               Section 6229(a) generally provides for a 3-year period                 
          within which respondent may assess a partnership or affected                

               3 A TMP is defined as the general partner designated as such           
          by the partnership or the general partner with the largest                  
          profits interest at the close of the year in question (or, where            
          there is more than one such partner, then the one of such                   
          partners whose name appears first alphabetically).  If no partner           
          is designated and the Secretary determines it is impracticable to           
          apply the above rules, then the Secretary may select a TMP.  Sec.           
          6231(a)(7).                                                                 




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