Rhone Poulenc Surfactants and Specialties, L.P. - Page 1

                                   114 T.C. No. 34                                    

                               UNITED STATES TAX COURT                                

                  RHONE-POULENC SURFACTANTS AND SPECIALTIES, L.P.,                    
                  GAF CHEMICALS CORPORATION, A PARTNER OTHER THAN                     
                      THE TAX MATTERS PARTNER, Petitioner v.                          
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

               Docket No. 2125-98.                     Filed June 29, 2000.           

                    R’s notice of final partnership administrative                    
               adjustment (FPAA) treated 1990 transfers of business                   
               assets to P’s partnership as taxable sales by P rather                 
               than as nontaxable transfers in exchange for                           
               partnership interests under sec. 721, I.R.C.  P, a                     
               partner other than the tax matters partner, filed the                  
               petition and then moved for summary judgment on the                    
               ground that the period of limitations for assessing any                
               tax resulting from this partnership proceeding has                     
               expired.  R alleges that failure to report the sale on                 
               P’s return resulted in omission of more than 25 percent                
               of reported gross income so that, pursuant to sec.                     
               6501(e)(1)(A), I.R.C., the period for assessing tax did                
               not expire until 6 years after P’s return was filed.                   
               The FPAA was issued several days before the expiration                 
               of 6 years from the filing of P’s 1990 return.                         
                    Held:  (1) Sec. 6229(a), I.R.C., includes an                      
               alternative, minimum period of limitations, applicable                 

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