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recoupment is an affected item, we need not further discuss that
point.
3. The Partners’ Remedies
Intervenor argues that, unless we conclude that equitable
recoupment is a partnership item, the partners will be barred
from defending against any computational adjustment on account of
subsections (a)(1) and (c)(1) and (4) of section 6230, which,
according to intervenor, (1) render the deficiency procedures
inapplicable to computational adjustments except in the case of a
deficiency attributable to affected items requiring partner-level
determinations and (2) restrict refund suits to claims arising
out of erroneous computations and the like.
In respondent’s memorandum in support of his objection to
the motion, respondent states: “The defense of equitable
recoupment is an affected item requiring determinations at the
individual partner level.” With respect to the facts of this
case, respondent states in his objection:
Any defense of equitable recoupment requires an
inquiry at the individual partner level to determine
whether there is a deficiency in income tax with
respect to an individual partners [sic] that would
result (by means of computational adjustment) from the
Court’s determination at the partnership level the
[sic] for the year at issue and if so, whether there is
any amount to be recouped in a subsequent year.
In Powell v. Commissioner, T.C. Memo. 1997-560, the
taxpayers petitioned the Court in response to the Commissioner’s
notices determining deficiencies attributable to certain affected
items (the affected items were additions to tax). Previously,
the Commissioner had made computational adjustments, which had
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