Richard A. and Janice S. Adams - Page 8

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          Court's opinion in Commissioner v. Schleier, supra.  Prior to               
          that time there was confusion concerning the scope of section               
          104.  Indeed, even in the wake of Commissioner v. Schleier,                 
          supra, there is continuing litigation concerning releases similar           
          to that executed here.  See, e.g., Brennan v. Commissioner, T.C.            
          Memo. 1997-317; Morabito v. Commissioner, T.C. Memo. 1997-315;              
          Keel v. Commissioner, T.C. Memo. 1997-278; Webb v. Commissioner,            
          T.C. Memo. 1996-50; Elpi v. United States, Civil No. 3:96CV00315            
          (D. Conn., June 12, 1997).  While petitioners' position may be              
          wrong, we cannot say that it was unreasonable considering the               
          confusion in this area of the law.  Accordingly, we do not                  
          sustain the section 6662(a) penalty.                                        


                                             Decision will be entered                 
                                        for respondent with respect to                
                                        the deficiency and for petitioners            
                                        with respect to the penalty under             
                                        section 6662(a).                              
















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