Tom and Brenda Kelly - Page 2

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               Respondent determined a deficiency in petitioners' Federal             
          income tax for 1993 in the amount of $2,954 and an accuracy-                
          related penalty pursuant to section 6662(a) in the amount of                
          $591.                                                                       
               After concessions by the parties,2 the issue remaining for             
          decision is whether respondent's acceptance and cashing of                  
          petitioners' check constitutes an accord and satisfaction of                
          their Federal income tax liability for 1993.                                
               Some of the facts have been stipulated and are so found.               
          The stipulations of fact and attached exhibits are incorporated             
          herein by this reference.  Petitioners resided in Catawissa,                
          Missouri, on the date the petition was filed in this case.  All             
          references to petitioner in the singular are to Tom Kelly.                  
               On March 29, 1996, petitioners received a letter from                  
          respondent's Appeals Office which stated that the total amount              
          due for their 1993 taxable year was $2,907.05.  This amount                 
          included tax in the amount of $2,044, a penalty in the amount of            
          $395, and interest through April 15, 1996, in the amount of                 
          $468.05.                                                                    
               On June 10, 1996, petitioners mailed a check in the amount             
          of $2,513 to the Internal Revenue Service.  Petitioner, who                 
          formerly worked as an attorney, wrote "93 Full payment of tax               

          2         The parties agreed at trial that the amount of the                
          deficiency in petitioners' Federal income tax for 1993 is $2,044            
          and the amount of the sec. 6662(a) accuracy-related penalty is              
          $395.                                                                       




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