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For example, in the case of criminal tax investigations,
partnership items would not be treated as nonpartnership items
unless a partner: (1) Was notified that he was the subject of a
criminal tax investigation; and (2) received written notification
that his partnership items would be treated as nonpartnership
items. See sec. 301.6231(c)-5T, Temporary Proced. & Admin.
Regs., 52 Fed. Reg. 6793 (Mar. 5, 1987). Therefore, the timing
of the treatment of a partner's partnership items as
nonpartnership items is specified in each regulation.
Section 301.6231(c)-5T, Temporary Proced. & Admin. Regs.,
supra, consists of three sentences. Petitioners dispute
respondent’s interpretation of the regulation and contend that
the second and third sentences solely address: (1) Which
partnership items become nonpartnership items; and (2) when
partnership items are converted to nonpartnership items.
Petitioners also contend that the last two sentences of the
regulation conflict with the first sentence and with the language
of section 6231(c). In sum, petitioners urge this Court to read
the first sentence of section 301.6231(c)-5T, Temporary Proced. &
Admin. Regs., supra, in isolation, divorced from the regulation
as a whole.
Petitioners' interpretation of the interaction between
section 6231(c) and section 301.6231(c)-5T, Temporary Proced. &
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