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tax year. If the consents are valid, the FPAA is timely and the
period of limitations for making assessments attributable to
Madison’s 1982 tax year remains in suspense pursuant to section
6229(d); if the consents are not valid, the period of limitations
for making assessments attributable to Madison’s 1982 tax year
expired before the FPAA was issued.
Petitioners, relying upon Transpac Drilling Venture 1982-12
v. Commissioner, 147 F.3d 221 (2d Cir. 1998), revg. and remanding
Transpac Drilling Venture 1982-16 v. Commissioner, T.C. Memo.
1994-26, argue that the consents are invalid. Petitioners point
out that Roberts had previously been the subject of section 6700
sanctions and was under criminal investigation at the time that
the consents were signed. According to petitioners, a conflict
of interest legally removed Roberts’ authority to act, personally
or through his attorney-in-fact, on behalf of Madison.3
In Transpac Drilling Venture 1982-12, the IRS began a civil
examination of the Transpac partnerships in the latter part
of 1983. In November 1985, a criminal referral was made.
The promoter and the tax matters partners of the Transpac
partnerships were the targets in the ensuing criminal tax
investigation. Sometime during the course of the criminal
3 Petitioners also argue that the power of attorney did not
give Jacobson the authority to extend the period of limitations
for Madison’s 1982 taxable year. We have previously considered
and rejected that argument in Madison Recycling Associates v.
Commissioner, T.C. Memo. 1992-605.
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