Lawrence V. and Katharine T. Brookes - Page 8

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               partnership items.  Sec. 6231(a)(6); White v.                          
               Commissioner, supra.  Once partnership level                           
               proceedings are completed, respondent is permitted to                  
               assess a computational adjustment against a partner                    
               without issuing a deficiency notice.  Sec. 6230(a)(1).                 
                    The second type of affected item requires a                       
               partner level determination.  N.C.F. Energy Partners v.                
               Commissioner, 89 T.C. 741, 744 (1987).  Section                        
               6230(a)(2)(A)(i) provides that the normal deficiency                   
               procedures apply to those affected items which require                 
               partner level determinations.  The additions to tax for                
               negligence and valuation overstatement are affected                    
               items requiring factual determinations at the                          
               individual partner level.  N.C.F. Energy Partners v.                   
               Commissioner, supra at 745.  It is well settled that we                
               lack jurisdiction to consider partnership items in an                  
               affected items proceeding.  Saso v. Commissioner, 93                   
               T.C. 730 (1989).                                                       
          Although petitioners allege error concerning affected items                 
          (additions to tax), they are not pursuing the merits of that                
          controversy at this time.  Instead, they ask us to redetermine              
          tax attributable to partnership items because they did not                  
          receive notice of the settlement of those items.                            
               In Crowell v. Commissioner, supra, we considered the effect            
          of a taxpayer’s lack of notice of the partnership proceeding on             
          the validity of an affected items notice of deficiency.  In                 
          Crowell, the taxpayers argued that they had not received notice             
          of the partnership-level proceeding from respondent in accordance           
          with section 6223(a), and no petition was filed to contest the              
          FPAA.  We reasoned that the partnership items set forth in the              
          Crowell FPAA would become nonpartnership items under section                
          6223(e) if the taxpayers had not been sent proper notice.  See              
          sec. 6231(b)(1)(D).  We concluded that under these circumstances,           

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