- 6 -
of paragraph one of the original settlement agreement without
being bound by the burdens of the at risk provisions set forth in
the remaining paragraphs. Respondent has refused to extend
offers of settlement terms to participants under these
circumstances.5
Discussion
TEFRA--Partnership and Nonpartnership Items
The parties agree that the partnerships are subject to the
audit and litigation procedures of the Tax Equity & Fiscal
Responsibility Act of 1982 (TEFRA), Pub. L. 97-248, 96 Stat. 324.
The principal purpose behind TEFRA is to provide consistency and
reduce duplication in the treatment of "partnership items" by
requiring that they be determined in a unified proceeding at the
partnership level. Maxwell v. Commissioner, 87 T.C. 783, 787
(1986); H. Conf. Rept. 97-760, at 600 (1982), 1982-2 C.B. 662;
see also Slovacek v. United States, 40 Fed. Cl. 828 (1998).
Partnership items include each partner's proportionate share
of the partnership's aggregate items of income, gain, loss,
deduction, or credit. Sec. 6231(a)(3); sec. 301.6231(a)(3)-
1(a)(1)(i), Proced. & Admin. Regs. Partnership items also
include each partner's proportionate share of the partnership's
liabilities, including determinations with respect to the amount
5
As we understand, at least until these cases were
submitted, respondent was still offering the settlement to
partners who were willing to accept all of the settlement terms.
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