Estate of Melvin W. Ballantyne, Deceased, Jean S. Ballantyne, Independent Executrix, and Jean S. Ballantyne - Page 30




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          allocation of items until after Melvin died.19  The testimony at            
          trial indicated that all witnesses believed that Melvin and                 
          Russell had a close relationship and shared equally in                      
          partnership items.  In fact, the estate’s original and amended              
          Forms 1041 for 1994 and 1995 reflect the estate’s belief that it            
          acquired a 50-percent interest in BBP as a result of Melvin’s               
          death.20  No evidence was presented suggesting that either                  
          brother had a problem with the partnership arrangement or the way           
          partnership items were reported.  Each brother appeared to have             
          been content with the equal reporting arrangement and held                  
          himself out as owning an equal interest in the partnership.  The            
          tax returns for the years 1980 through 1994 indicate that in some           
          years the income from the oil and gas activity was more than the            
          income from the farming activity and vice versa.                            
               All partners’ interests in a partnership are considered                
          equal.  Sec. 1.704-1(b)(3)(i), Income Tax Regs.  It is undisputed           



               19Consistent with allocations reported on BBP’s partnership            
          returns, Melvin and Russell reported one-half of partnership                
          items on their individual Federal income tax returns.  This Court           
          has previously recognized that statements made in a Federal tax             
          return are generally considered an admission by the taxpayer and            
          will not be overcome without cogent evidence that they are wrong.           
          Estate of Hall v. Commissioner, 92 T.C. 312, 337-338 (1989); Lare           
          v. Commissioner, 62 T.C. 739, 750 (1974), affd. without published           
          opinion 521 F.2d 1399 (3d Cir. 1975); Gale v. Commissioner, T.C.            
          Memo. 2002-54.                                                              
               20The estate’s amended Form 1041 for 1995 was stamped                  
          received by the Internal Revenue Service in Austin, Texas, on               
          Mar. 7, 1997, more than 3 years after the date of Melvin’s death.           





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