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Petitioner maintains that (1) in light of the preambles of
the stipulations of settled issues of Betsy’s dockets, the
literal language of the claimed concessions applies to him, and
(2) respondent should be held to the claimed concessions.
Respondent contends that the concessions that the Commissioner
made in the stipulations of settled issues in Betsy’s dockets do
not have any bearing on the disposition of the issues in
petitioner’s dockets.
We agree with respondent.5
The compromise and settlement of tax cases is governed by
general principles of contract law. Dorchester Indus. Inc. v.
Commissioner, 108 T.C. 320, 330 (1997). In Robbins Tire & Rubber
Co. v. Commissioner, 52 T.C. 420, 435-436 (1969), we stated
that:
a compromise is a contract and thus is a proper subject of
judicial interpretation as to its meaning, in the light of
the language used and the circumstances surrounding its
execution. [Citations omitted]
5 Where petitioner and Betsy are liable for the same
item, a payment by one in effect extinguishes the obligation of
the other to make the same payment. Thus, Betsy’s agreements
with the Commissioner may ultimately affect how much petitioner
may be called on to pay. However, this consequence of payment of
liability by one of the jointly liable taxpayers does not affect
the deficiency redeterminations that we enter in the case of the
other jointly liable taxpayer. Kroh v. Commissioner, 98 T.C.
383, 391-394 (1992). In the instant cases, we deal only with the
decisions to be entered in petitioner’s dockets, and not with the
amounts that petitioner may be called on to pay.
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