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action thus puts an end to the cause of action, which the parties
cannot later litigate upon any ground whatever, absent a showing
of fraud or some other factor which would invalidate the
judgment. See Commissioner v. Sunnen, 333 U.S. at 597; Kroh v.
Commissioner, 98 T.C. at 398.
Three requirements must be satisfied for the doctrine of res
judicata to apply: (1) The parties in the second case are the
same as or in privity with the parties in the first case; (2) the
cause of action in the second case is in substance the same as
that in the first case; and (3) the first case resulted in a
final judgment on the merits by a court of competent
jurisdiction. See Nevada v. United States, 463 U.S. 110, 129-130
(1983); Federated Department Stores, Inc. v. Moitie, 452 U.S.
394, 398 (1981); Commissioner v. Sunnen, 333 U.S. at 597.
Petitioner and respondent were parties in petitioner’s
bankruptcy case. Thus, the first element of res judicata is
satisfied. See, e.g., Florida Peach Corp. v. Commissioner, 90
T.C. 678, 682 (1988).
The second element of res judicata requires that the cause
of action in the second case be in substance the same as the
cause of action in the first case. Each taxable year “is the
origin of a new liability and of a separate cause of action.”
Commissioner v. Sunnen, 333 U.S. at 598. If a claim of liability
or nonliability for a particular tax year is litigated, then a
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