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this office for signing and filing with the Court. The
remaining copy is for your records.
As previously indicated, the Decision documents in
John R. and Maydee Thompson will not be filed with the
Court until the Decision becomes final in the test
cases. In the interim, the Thompsons can make an
advance payment, as discussed at our conference, and
stop the accrual of any additional liability for
interest.
In response, on December 30, 1986, Mr. DeCastro executed three
separate decision documents on behalf of the Thompsons agreeing
to the following deficiencies:
Year Deficiency Additions to Tax
1979 --- ---
1980 $34,425 ---
1981 30,000 ---
The December 1986 settlements that Mr. McWade extended to
Mr. DeCastro's clients differed from the 7-percent official
Kersting project settlement offer used by respondent's Appeals
Office. In particular, the Thompson settlement included the
burnout feature and was based on a reduction of the deficiencies
that respondent had determined against the Thompsons of
approximately 19 percent as follows:
Year Adjustment Deficiency Settlement % Reduction
1979 $39,477 $18,161 ---
1980 72,840 24,838 $34,425
Total 42,999 34,425 20%
1981 $80,782 36,295 30,000 17
All years total 79,294 64,425 19
The adjustments for each year consisted solely of the
disallowance of deductions that the Thompsons had claimed with
respect to Kersting programs.
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