Gregory Powell & Araminta D. Morton - Page 4

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          Petitioners filed a response to respondent's response which                 
          states in pertinent part as follows:                                        
               Petitioners were informed by I.R.S. Auditor that                       
               additional information received late was being                         
               considered and processed.  This action by the I.R.S.                   
               Auditor constitutes an implied extension on the part of                
               the Respondent.  Petitioners would not have any way of                 
               knowing what if any deduction had to be petitioned to                  
               the Court until a final decision was rendered by the                   
               Auditor. * * *                                                         
          A hearing was conducted at the Court's motions session in                   
          Washington, D.C.  Petitioner Gregory Powell and counsel for                 
          respondent appeared at the hearing and presented argument                   
          respecting respondent's motion to dismiss.  During the hearing,             
          Mr. Powell conceded that the revised examination report was                 
          mailed to him without a cover letter and that he did not                    
          otherwise discuss the continuing validity of the April 28, 1997,            
          notice of deficiency with respondent's agent.  There is no                  
          evidence in the record that petitioners ever requested Form 8626            
          (Agreement to Rescind Notice of Deficiency) from respondent or              
          that respondent's agents ever proffered Form 8626 to petitioners.           
          Discussion                                                                  
               The Court's jurisdiction to redetermine a deficiency depends           
          upon the issuance of a valid notice of deficiency and a timely              
          filed petition.  Rule 13(a), (c); Monge v. Commissioner, 93 T.C.            
          22, 27 (1989); Normac, Inc. & Normac Intl. v. Commissioner, 90              
          T.C. 142, 147 (1988).  Section 6212(a) expressly authorizes the             
          Commissioner, after determining a deficiency, to send a notice of           




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