15
OPINION
A. Transferee Liability
Respondent contends that petitioner is liable as a successor
transferee (i.e., a transferee of a transferee) for the 1985
income tax and additions to tax owed by Stanko Packing.
Petitioner disagrees.
The Commissioner may collect unpaid income taxes of a
transferor of assets from a transferee or a successor transferee
of those assets. Sec. 6901(a), (c)(2); Commissioner v. Stern,
357 U.S. 39, 42 (1958); Stansbury v. Commissioner, 104 T.C. 486,
489 (1995). State law generally determines the extent of the
transferee's liability. Commissioner v. Stern, supra at 45; Gumm
v. Commissioner, 93 T.C. 475, 479 (1989), affd. without published
opinion 933 F.2d 1014 (9th Cir. 1991). Therefore, we apply
Nebraska law in deciding whether petitioner is liable as a
transferee under section 6901.
The Commissioner bears the burden of proving that the
taxpayer is liable as a transferee under State law or in equity.
Sec. 6902(a); Rule 142(d); Gumm v. Commissioner, supra at 479-
480. Petitioner bears the burden of proving that the transferor
is not liable for the tax and additions to tax. Sec. 6902(a).
B. Res Judicata
We first decide whether petitioner is precluded by res
judicata from contesting that Stanko Packing’s income tax
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