Phillip Lee Allen and Carolyn F. Allen - Page 12




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                    (i)   The party, prior to filing a petition in the                  
               Tax Court or a civil action for refund in a court of                     
               the United States (including the Court of Federal                        
               Claims), participates, either in person or through a                     
               qualified representative described in � 601.502 of this                  
               chapter, in an Appeals office conference; or                             
                         *     *    *    *    *    *    *                               
                    (2)  Participates.  For purposes of this section,                   
               a party or qualified representative of the party * * *                   
               participates in an Appeals office conference if the                      
               party or qualified representative discloses to the                       
               Appeals office all relevant information regarding the                    
               party’s tax matter to the extent such information and                    
               its relevance were known or should have been known to                    
               the party or qualified representative at the time of                     
               such conference.  [Emphasis supplied.]                                   
          Sec. 301.7430-1(a) and (b), Proced. & Admin. Regs.                            
               In this case, the question of whether petitioners’                       
          administrative remedies were exhausted depends upon whether they              
          “participated” in an Appeals conference.  In common parlance,                 
          petitioners, through their representatives, participated in an                
          Appeals office conference.9  Respondent, however, relying on the              
          above-quoted definition of “participates” in section 301.7430-                
          1(b)(2), Proced. & Admin. Regs., contends that petitioners did                
          not exhaust their administrative remedies.  Therefore, the                    
          narrower question we must decide is whether petitioners disclosed             
          “to the Appeals office all relevant information * * * to the                  




               9 The term “participate” generally means to take part in                 
          some activity with others.  Webster’s Third New International                 
          Dictionary 1646 (1986).                                                       





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