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the adjustment where such adjustment is treated as if it
were a deficiency. The issuance of such notice of
deficiency, in accordance with the law and regulations
applicable to the assessment of deficiencies will suspend
the running of the 1-year period of limitations provided in
section 1314(b). * * *
Any doubt as to sequencing that might have remained after
examining the statute is dispelled by the Treasury Regulations,
which require respondent to issue the notice of deficiency within
“one year from the date of the determination”. Thus, the
structure of the mitigation provisions does not leave room for a
mitigation claim to be made in a notice of deficiency issued
before a relevant determination.
Because the notices of deficiency in the instant case were
issued before the only determinations that could be relevant
determinations as to petitioners herein, these notices of
deficiency have not made effective mitigation claims.
This analysis is consistent with, and this conclusion is
identical to, that appearing in O’Donnell v. Belcher, 414 F.2d at
842-843.
This conclusion also is consistent with the analyses in
Benenson v. United States, 385 F.2d at 30-31 n.7, and Cory v.
Commissioner, 29 T.C. 903, 907 (1958), affd. 261 F.2d 702, 704
(2d Cir. 1958), to the effect that until the decision in the
first case became final (1) “there can be no certain need for an
adjustment” (Benenson), and (2) the Commissioner “could not
correctly determine a deficiency” for the second case (Cory).
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Last modified: May 25, 2011