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Appeals Office requesting that the Cravens cases be closed in
accordance with special closing instructions. The intent of
these instructions as stated in the memorandum was "to cause the
taxpayers' 1979 and 1980 accounts to zero out with no further
amounts due." This was to be accomplished by adjusting the
interest that would otherwise have become due on the assessments
made in accordance with the stipulated decision previously
entered by the Tax Court on August 25, 1992. The memorandum
explained the proposed interest adjustment as follows:
The amount of interest being assessed has been
adjusted because the decision document tendered to
petitioners and subsequently filed with the Court in
settlement of this case did not comport with District
Counsel's 1986 settlement offer. The settlement offer
provided that the first year deficiency would be
shifted to the second year. Accordingly, there would
have been no deficiency for 1979 and the deficiency for
1980 would have been increased to $9,782 ($3,606 +
$6,176). The amount of interest being assessed has
been adjusted because this provision was not included
in the decision documents and because the decision
documents in this case were not promptly prepared and
filed with the Tax Court in December 1986 when the case
was settled. The balance of the adjustment relates to
computational errors in District Counsel's original
computation of the amounts due.
The authority stated in the memorandum for reducing the amounts
due from the Cravenses was section 6404(a)(1), relating to
excessive assessments, and section 6404(e)(1), relating to
abatement of interest.
As mentioned supra note 2, the Court of Appeals for the
Ninth Circuit held that the Cravens decisions became final
pursuant to section 7481(a)(1), despite the attempts by Messrs.
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