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upon a showing of fraud, malfeasance, or misrepresentation of a
material fact. Sec. 7121(b); Zaentz v. Commissioner, 90 T.C.
753, 760 (1988).
Neither respondent nor petitioners ask us to set aside the
Closing Agreement. Moreover, they do not contend that there
exists any fraud, malfeasance, or misrepresentation of a material
fact. Both parties assert that the Closing Agreement is
unambiguous. They disagree, however, with respect to the proper
interpretation of the Closing Agreement.
Ordinary principles of contract law govern the
interpretation of Closing Agreements. Rink v. Commissioner, 100
T.C. 319, 325 (1993), affd. 47 F.3d 168 (6th Cir. 1995).
Contract law principles generally direct that we look within the
"four corners" of the Closing Agreement, unless it is ambiguous
as to essential terms. Id. at 325.
The parties chose Form 906 as their Closing Agreement. Form
906 is used where there is an agreement with respect to the
closing of specific matters affecting tax liability. Estate of
Magarian v. Commissioner, 97 T.C. 1, 5 (1991). A Form 906
Closing Agreement is a final and conclusive agreement that is
binding as to the matters agreed upon for the stated taxable
year. Qureshi v. Commissioner, T.C. Memo. 1996-169.
We are again faced with construing a closing agreement
entered into by petitioners and respondent. We start with
petitioners' 1980 Federal income tax return on which petitioners
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