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criminal charges, and consequently no specific income tax
liabilities needed to be determined. See Hickman v.
Commissioner, T.C. Memo. 1997-566 (adjudication of a taxpayer’s
liability was not essential to a conviction under section 7203;
therefore, a prerequisite to the application of collateral
estoppel was not satisfied).
As discussed above, under section 7442, this Court acquired
exclusive jurisdiction to adjudicate petitioners’ civil tax
liabilities for the years that were petitioned. More
importantly, the resolution of petitioners’ civil tax liabilities
was not essential to the District Court’s judgment, and the
amounts of petitioners' civil tax liabilities were not
specifically litigated or adjudicated in the criminal proceeding.
Because the District Court did not decide the specific amounts of
petitioners' civil tax liabilities, neither res judicata nor
collateral estoppel applies.
Petitioners also argue that the Government cannot be
permitted to recover twice on the same tax liability. This Court
has jurisdiction to determine whether or not a deficiency or
overpayment exists. Should it ultimately be determined that
petitioners have made payments in excess of any redetermined tax
liability, this Court has jurisdiction to decide the correct
amount of any overpayment in the taxable years before the Court.
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Last modified: May 25, 2011