- 21 -
actions taken by EMFI and petitioners do not meet the minimum
requirement of a clear and unequivocal expression of their intent
to make the election.11 Fisher Indus., Inc. v. Commissioner,
supra; Young v. Commissioner, supra.
For the above-stated reasons, we decline to apply the
doctrine of substantial compliance in this instance to force
petitioners and EMFI to treat distributions for their respective
1992 and October 31, 1993, years as distributions of earnings and
10(...continued)
return". Sec. 1.1368-1(f)(5)(iii), Income Tax Regs.; sec.
1.1368-1(f)(5), Proposed Income Tax Regs., 57 Fed. Reg. 24435
(June 9, 1992). We do not see that the outcome of our decision
today is meaningfully different than the current regulatory
framework.
11We also note that some courts have taken a narrow view of
the judicial doctrine of substantial compliance. See Prussner v.
United States, 896 F.2d 218, 224 (7th Cir. 1990); Credit Life
Ins. Co. v. United States, 948 F.2d 723, 726-727 (Fed. Cir.
1991); Rockwell Inn, Ltd. v. Commissioner, T.C. Memo. 1993-158.
In Prussner v. United States, supra at 224, the Court of Appeals
for the Seventh Circuit addressed the application of the doctrine
of substantial compliance, stating:
The common law doctrine of substantial compliance
should not be allowed to spread beyond cases in which
the taxpayer had a good excuse (though not a legal
justification) for failing to comply with either an
unimportant requirement or one unclearly or confusingly
stated in the regulations or the statute. * * *
[Emphasis added.]
See also Bartlett v. Commissioner, 937 F.2d 316, 321 (7th Cir.
1991), affg. Estate of Grimes v. Commissioner, T.C. Memo. 1988-
576.
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