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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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Last modified: May 25, 2011