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during the year. The amended return reflects the correct tax
basis of $1,500 per share. There were no other changes.” Other
than the return itself and the statement attached thereto, no
written or oral communication to the Internal Revenue Service
preceded or accompanied the filing of the amended return. On
February 15, 1988, respondent responded to the amended return by
refunding $50,001, plus interest, to the Administration Trust.
Respondent has never issued a statutory notice of deficiency to
the Administration Trust or otherwise determined a deficiency in
its Federal income tax for the taxable year 1986. The
Administration Trust is not a party to this proceeding.
On or about September 10, 1990, the Administration Trust
filed a second amended fiduciary income tax return claiming an
$862,377 refund of the income tax it had paid on the capital gain
from the sale of the 6,650 shares. This amended return was filed
3 years and 5 months after the Administration Trust had
originally filed its Federal income tax return and paid the
income tax for the taxable year 1986. This was less than 3 years
after the Administration Trust had filed its first amended 1986
income tax return, almost 1 year after respondent had issued the
statutory notice to petitioner, and 7 months after petitioner had
filed its petition. The Administration Trust’s second amended
return bore the designation “Amended Return - Correction” and
claimed that, in computing the gain on the sale of the shares, it
had used a fair market value basis that was $650 lower than the
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