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Respondent contends that S/V is entitled to the greater of either
a credit based on the rules applicable to gas produced from a
tight formation (i.e., $3 x 32,410 BOE) or a credit based on the
rules applicable to gas produced from Devonian shale (i.e., $3
(adjusted for inflation) x 16,927 BOE). Indeed, respondent’s
alternative position1 is that if 32,410 BOE of S/V’s gas
qualifies for the credit, the credit is based on the rules
applicable to gas produced from a tight formation and, thus, not
adjusted for inflation. In addition, why should respondent be
considered “to have conceded this issue” when the issue was not
briefed by either party? In support of its conclusion, the
majority cites cases that are not applicable. In these cases,
the courts appropriately concluded that a taxpayer made a
concession when the taxpayer failed to address an issue that
previously had been raised.2
1 In his opening brief, respondent states: “In the pursuit
of fairness, respondent allowed S/V Drilling the I.R.C. � 29
credit for Devonian shale gas, since this credit was inflation
adjusted and, consequently, greater in amount than the credit
provided for tight sands gas.”
2 See Askew v. United States, 680 F.2d 1206, 1208 n.2 (8th
Cir. 1982) (stating that taxpayer “apparently concedes this point
because he makes no argument on appeal” relating to a fact that
the Government had established at trial); Levin v. Commissioner,
87 T.C. 698, 722-723 (1986) (stating that “petitioners have made
no argument with respect to the other deductions” disallowed in
notices of deficiency), affd. 832 F.2d 403 (7th Cir. 1987);
Zimmerman v. Commissioner, 67 T.C. 94, 104 n.7 (1976) (stating
that petitioners made an allegation in their petition, but “at
trial and on brief they made no argument in this regard and we
deem them to have conceded this issue”).
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