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settlement of partnership items must be self-contained; i.e., not
premised upon the settlement of nonpartnership items, and second,
an original settlement must determine all partnership items.14
Sec. 301.6224(c)-3T(b), Temporary Proced. & Admin. Regs., 52 Fed.
Reg. 6787 (Mar. 5, 1987).
The instant cases afford a prime example of the mischief
that the temporary regulation aims to curtail. If, as
participants argue, paragraph one of the original settlement
agreements may be the subject of a consistent settlement
agreement, then they are entitled to receive consistent treatment
only with respect to this provision through their request under
section 6224(c)(2). In essence, participants seek to extract the
benefits from paragraph one and disregard the burdens from the
other provisions of the original settlement agreements. Although
cloaked beneath the mantle of consistent settlement, what
participants actually seek are settlements that are inconsistent
with those received by other partners.
14
A mechanism exists by which a settlement agreement may
be effected so as to comply with the requirements of the
temporary regulation. The Court takes notice of the fact that
respondent has utilized Form 870-L(AD) (Settlement Agreement for
Partnership Adjustments and Affected Items) to settle adjustments
with individual partners. The form contains two separate and
distinct parts: Part one is used to settle partnership items,
while part two is used to settle nonpartnership and affected
items. See, e.g., Olson v. United States, 37 Fed. Cl. 727, 729
(1997).
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