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Circuit also affirmed imposition against the taxpayers therein of
additions to tax under sections 6653(a)(1), (a)(2), and 6661.
Id.
OPINION
A settlement stipulation, such as a stipulation to be bound
by a controlling case, is “in all essential characteristics a
mutual contract * * * entitled to all of the sanctity of any
other contract.” Saigh v. Commissioner, 26 T.C. 171, 177 (1956).
General principles of contract law are applied in construing such
agreements. Robbins Tire & Rubber Co. v. Commissioner, 52 T.C.
420, 435-436 (1969).
As we understand the language of petitioners’ and of
respondent’s March 16, 1998, settlement stipulation, it provides
that all of the remaining issues in this case shall be resolved
on the same basis as those issues are finally resolved in Chimblo
v. Commissioner, supra.
As indicated, in Chimblo, the Court of Appeals for the
Second Circuit concluded, as have other courts, that under the
Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA), Pub. L.
97-248, sec. 402, 96 Stat. 648, a statute of limitations defense
regarding an adjustment to a “partnership item” must be raised in
a partnership level proceeding. Chimblo v. Commissioner, supra
at 125; Kaplan v. United States, 133 F.3d 469, 473 (7th Cir.
1998); Crowell v. Commissioner, 102 T.C. 683, 693 (1994); Saso v.
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