Astrida Terauds - Page 19

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          law to pay that tax on the date the return was filed.  That tax             
          was paid, as shown on the return, by taxes withheld, a cash                 
          payment petitioner submitted with the return, and the amount of             
          $2,899.89 to be taken from proceeds of a levy that petitioner               
          identified on her return.  At the time petitioner's 1987 return             
          was filed, there were no other outstanding assessments against              
          her as to which respondent could have applied the amount at                 
          issue.  In view of these facts and circumstances, we conclude               
          that respondent should have applied the $2,899.89 levy proceeds             
          identified on the return toward payment of the tax shown on that            
          return filed by petitioner.  Respondent has given no factual                
          reason and no legal basis for disallowing this amount as a                  
          payment and later applying such amount toward payment of a                  
          subsequently assessed tax liability.  Petitioner is sustained on            
          this issue.                                                                 
               As to the second part of this issue, petitioner contended              
          that the $2,884 disallowed as a payment by respondent in the                
          notice of deficiency represented the proceeds of another levy on            
          a different bank account, and that the $2,884 should be allowed             
          to her as an additional credit.  Petitioner failed to establish             
          that there was such a levy.  Respondent's transcript did not                
          reflect that such proceeds were realized through levy, other than           
          the amounts listed earlier in this opinion.  Petitioner presented           
          no evidence from the bank or savings institution from which she             

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