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the definition of a deficiency for present purposes is reduced to
the excess of the estate tax imposed over the amount of estate
tax shown on the return.
The parties’ settlement in this case produced an
overassessment in tax. This somewhat anomalous result
(particularly in light of the concessions made by the estate) is
attributable to the interest expense deduction, which the estate
was prohibited from claiming prospectively on the estate tax
return.12 Yet, despite the unique circumstances of this case, it
remains that the tax imposed on the estate does not exceed the
amount of the tax shown on the estate tax return. A deficiency
in tax, as defined by section 6211, therefore does not exist.
Having decided that there is no statutory deficiency, it
follows that no portion of the assessed addition to tax is
attributable to a deficiency. In other words, the requirements
of paragraph (1) of section 6665(b) have not been met.
Accordingly, pursuant to section 6665(b), we lack jurisdiction
over the addition to tax at issue.13 We therefore may not reach
12 The procedure for claiming a deduction for interest
expense attributable to a deferred estate tax obligation is to
file a supplemental estate tax return after the interest has
accrued and been paid. See Rev. Proc. 81-27, 1981-2 C.B. 548.
Therefore, a taxpayer may not take a deduction on the original
estate tax return for interest which is estimated to accrue on
the deferred estate tax obligation. See Bailly v. Commissioner,
81 T.C. 246 (1983), supplemented by 81 T.C. 949 (1983).
13 That we lack jurisdiction to decide the issue is
confined to the facts of this case. We do not hold, for example,
that this Court lacks jurisdiction under sec. 6512(b)(1) to
(continued...)
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Last modified: May 25, 2011