- 9 -
There is nothing in the record to indicate how much of
Exxon's claim related to excess royalties paid to Jessamine or
her estate, and respondent does not factor this into respondent's
computation. Since it appears likely that some part of the claim
against decedent was attributable to royalties paid to Jessamine
or her estate, respondent's decision not to allocate any portion
of the settlement to Jessamine works in petitioner's favor.7
Respondent's computation uses Exxon's allocation of its claims as
between decedent and Frankie, which, as previously stated,
attributes to decedent 24 percent of the excess royalty claims
against decedent and Frankie. Under these circumstances, we find
that 24 percent is the most appropriate percentage for purposes
of determining the portion of the settlement that is available
for purposes of computing petitioner's section 1341 relief.
While we reject petitioner's argument that the entire
$681,840 is available to adjust decedent's previously reported
income, we also reject part of the computational method proposed
by respondent. Respondent's Rule 155 computation seems to assume
that decedent received royalties in excess of what she reported
for the years 1975 through 1980. This assumption is based on
unexplained allegations made by Exxon in its lawsuit. Relying on
Exxon's apparent claim that it paid more royalties to decedent
than she reported, respondent's computation reduces the portion
7Respondent's counsel explained that there was no
information upon which to allocate any of Exxon's claims to
royalties paid to Jessamine or her estate.
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