6
parties. We conclude accordingly that there is no dispute as to
any material fact and that we may proceed to dispose of this case
as a matter of law.
The general period of limitations in both income and estate
and gift tax cases is 3 years, measured from the date the return
is filed until respondent issues the appropriate statutory notice
of deficiency. Sec. 6501(a). Various exceptions to the general
3-year rule are provided by the statute, for such things as the
filing of fraudulent returns, the failure to file a return, an
agreement between the parties extending the time, etc. Of
particular interest to us in this case are the provisions of
section 6501(e), which provide in relevant part as follows:
(e) Substantial Omission of Items.--except as otherwise
provided * * *
(1) Income Taxes.--In the case of any tax imposed by
subtitle A--
(A) General Rule.--If the taxpayer omits from
gross income an amount properly includable therein
which is in excess of 25 percent of the amount of gross
income stated in the return, the tax may be assessed,
or a proceeding in court for the collection of such tax
may be begun without assessment, at any time within 6
years after the return was filed. For purposes of this
subparagraph--
* * * * * * *
(ii) In determining the amount omitted from
gross income, there shall not be taken into
account any amount which is omitted from gross
income stated in the return if such amount is
disclosed in the return, or in a statement
attached to the return, in a manner adequate to
apprise the Secretary of the nature and amount of
such item.
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