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returns for 1993, 1994, and 1995. Further, the record is not
completely clear as to what petitioners’ legal strategy was in
not participating in an Appeals Office conference. The affidavit
of petitioners’ counsel alleges generally that petitioners at all
times cooperated with respondent’s representatives and, at each
administrative level, pursued in good faith the resolution of the
issues in these cases.
The fact, however, is established that no Appeals Office
conference was requested on behalf of petitioners, and no
affidavit has been provided (by petitioners, by petitioners’
prior counsel, or by petitioners’ counsel) that provides any
explanation as to why an Appeals Office conference was not
requested. Statements in petitioners’ legal memoranda as to why
an Appeals Office conference was not requested by petitioners or
by petitioners’ prior counsel (without a supporting affidavit
from petitioners or from petitioners’ prior counsel explaining
the reason therefor) constitute mere argument.
It is clear that petitioners had an opportunity to protest
and to appeal respondent’s proposed income tax adjustments. In
the fall of 1997, 11 months before the period of limitations was
scheduled to expire, petitioners notified respondent’s
representatives that they did not wish to protest and participate
in an Appeals Office conference; rather, they expressly and in
writing requested that respondent close the audit so that they
could dispute the adjustments in court. Thereafter, petitioners’
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