Lawrence V. and Katharine T. Brookes - Page 13

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               Courts have repeatedly held that the normal deficiency                 
          procedures, including the notice of deficiency, do not apply to             
          the allocation of partnership items among partners.  Randell v.             
          United States, 64 F.3d 101, 107 (2d Cir. 1995); Pack v. United              
          States, 992 F.2d 955, 957-958 (9th Cir. 1993); Harris v.                    
          Commissioner, 99 T.C. 121, 125 (1992), affd. 16 F.3d 75 (5th Cir.           
          1994); Sente Inv. Club Partnership v. Commissioner, 95 T.C. 243,            
          249 (1990).  Despite this long line of cases, petitioners argue             
          that a notice of deficiency is required because the partnership             
          provisions do not vest respondent with authority to assess                  
          partnership items against the partners upon the conclusion of a             
          partnership proceeding.  Thus, respondent must rely on section              
          6201 for that authority.  Petitioners reason that since section             
          6201(d) refers to the deficiency procedures of subchapter B,                
          respondent must comply with that subchapter for all assessments,            
          including assessments attributable to partnership items.                    
               Section 6230(a)(1) provides that, in general, the deficiency           
          notice procedures do not apply to the assessment of computational           
          adjustments.  A "computational adjustment" is                               
               "the change in the tax liability of a partner which                    
               properly reflects the [tax] treatment * * * of a                       
               partnership item".  Sec. 6231(a)(6).  In short, a                      
               computational adjustment reflects the amount of change                 
               in the tax liability of a partner that is assessed                     
               after a FPAA proceeding becomes final * * *                            
          Palmer v. Commissioner, T.C. Memo. 1992-352, affd. without                  
          published opinion 4 F.3d 1000 (11th Cir. 1993).  However,                   

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