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mailed a notice of deficiency under section 6212(a) “and the
taxpayer files a petition with the Tax Court within the time
prescribed”. Hemmings v. Commissioner, 104 T.C. 221, 226-228
(1995). In this case, petitioners did not file a petition with
this Court challenging the February 24, 1999, notice of
deficiency. Accordingly, respondent was not barred by section
6212(c)(1) from issuing another notice of deficiency as to
petitioners’ 1996 taxable year.
2. Whether There Was a Binding Settlement
Petitioners argue that respondent settled their tax dispute
as to all matters relating to the 1996 taxable year when
petitioners signed the letter of March 31, 1999. That letter
provided for a response to respondent’s proposed changes whereby
petitioners could either agree or disagree with the proposed
changes. On April 5, 1999, petitioners signed the form and
checked the provision that stated:
Disagreement With Proposed Changes - I disagree with some or
all of the proposed changes on page 2 of this notice. For
each proposed change that I disagree with, I have attached a
signed statement and supporting documents explaining why.
There does not appear to have been any attached statement. On
April 6, 1999, however, petitioners sent a check for $11,818, and
by letter claimed a refund of $1,788 for interest.
We have held that
A settlement is a contract and, consequently, general
principles of contract law determine whether a settlement
has been reached. * * * A prerequisite to the formation of a
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