GAF Corporation and Subsidiaries - Page 1

                                    114 T.C. No. 33                                     

                                UNITED STATES TAX COURT                                 

                   GAF CORPORATION AND SUBSIDIARIES, Petitioner v.                      
                     COMMISSIONER OF INTERNAL REVENUE, Respondent                       

               Docket No. 23682-97.                    Filed June 29, 2000.             

                    R determined deficiencies in income tax based on                    
               “affected items” that are dependent upon the resolution                  
               of partnership items.  The resolution of the                             
               partnership items must be made at the partnership                        
               level.  The partnership level proceeding has not been                    
               completed.  P asks us to dismiss for lack of                             
               jurisdiction on the ground that respondent has                           
               determined deficiencies that are based on “affected                      
               items”, which may not be determined before final                         
               resolution of the partnership items to which they                        
               relate.  P relies on Maxwell v. Commissioner, 87 T.C.                    
               783 (1986) (striking affected items for lack of                          
               jurisdiction because the partnership proceeding had not                  
               been completed).                                                         
                    Held:  A valid notice of deficiency based on                        
               “affected items” may not be issued prior to completion                   
               of the related partnership-level proceedings.  Our                       
               jurisdiction is dependent upon a valid notice of                         
               deficiency.  R’s notice of deficiency is invalid.  This                  
               case is dismissed for lack of jurisdiction.                              

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