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disallowance of deductions in a section 183 election case is
invalid from lack of mutuality, and the Commissioner, we believe,
may not do likewise as to overpayments.
Respondent argues that if, as in the present case, no claim
for refund is filed prior to the mailing of a notice of
deficiency, then the amount of the refund is limited to the
amount that would be allowable under section 6511(b)(2) if a
claim had been filed on the date of the mailing of the notice of
deficiency, citing section 6512(b)(3)(B). Nevertheless, since
the period of limitations on assessment of any deficiency arising
from deductions relating to petitioners' horse boarding and
training activities has been extended by the section 183 election
(petitioners' overpayments being related solely to such
deductions), which elections we regard as tantamount to section
6501(c)(4) extensions, petitioners could have filed claims for
overpayment as of the deficiency notice dates by reason of
section 6511(c), even though no such claims were actually filed.
Therefore, this Court has jurisdiction to allow such claims
insofar as section 6512(b)(3) is concerned.
Respondent also suggests, referring to section 183(e)(4),
that the only period extended by a section 183(e) election is the
statutory period for the assessment of any deficiency
attributable to "such activity." We believe, and hold, that
section 183(e)(4) also extends, mutatis mutandis, the statutory
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