Ronald E. Reed - Page 3

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          Rule references are to the Tax Court Rules of Practice and                  
          Procedure.                                                                  





                                     Background                                       
               Some of the facts have been stipulated and are so found.               
          The stipulation of facts filed by the parties, with attached                
          exhibits, is incorporated herein by this reference.                         
               Petitioner was incarcerated in a Federal prison in Danbury,            
          Connecticut, at the time the petition herein was filed.                     
               From 1985 through 1989, petitioner was involved in dealing             
          cocaine in amounts ranging from 1/4 pound to multiple kilograms.            
               In June 1989, petitioner was indicted by a Federal grand               
          jury for conspiracy to distribute cocaine, distribution of                  
          cocaine, and money laundering (the indictment).                             
               On September 6, 1989, in response to the indictment,                   
          petitioner executed an agreement (the plea agreement) with the              
          U.S. Attorney for the District of Maryland to plead guilty to two           
          counts of the indictment:  conspiracy to distribute cocaine and             
          money laundering.  In paragraph 3.(f) of the plea agreement,                
          petitioner admits that he knowingly acquired, with proceeds                 
          traceable to transactions involving narcotics, certain real                 







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