Richard K. and Marilyn J. Phillips - Page 1

                                   114 T.C. No. 7                                     

                               UNITED STATES TAX COURT                                

                 RICHARD K. AND MARILYN J. PHILLIPS, Petitioners v.                   
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

               Docket No. 9354-96.                 Filed February 29, 2000.           

                    Ps were limited partners in several partnerships                  
               with the same designated tax matters partner (TMP).  At                
               the request of the Internal Revenue Service (IRS), the                 
               TMP executed Forms 872, Consent to Extend the Time to                  
               Assess Tax, extending the periods of limitations for                   
               the years in issue.                                                    
                    Before executing the extensions, the TMP had been                 
               the subject of criminal tax investigations by the IRS.                 
               The tax investigations ended before the TMP executed                   
               most of the extensions.                                                
                    Ps alternatively contend:  (1) That the second and                
               third sentences of sec. 301.6231(c)-5T, Temporary                      
               Proced. & Admin. Regs., 52 Fed. Reg. 6793 (Mar. 5,                     
               1987), are invalid and that the initiation of a                        
               criminal tax investigation of the TMP converted his                    
               partnership items into nonpartnership items as a matter                
               of law; (2) that the criminal tax investigation of the                 
               TMP created a conflict of interest between the TMP's                   
               duties as a fiduciary of the partnerships and his self-                
               interest as the subject of a criminal tax investigation                
               and that such a conflict necessitated his removal as                   
               TMP based on the rationale of Transpac Drilling Venture                

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