Thomas Edward Vanstone - Page 3

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               In May 1988, respondent notified petitioner that the correct           
          amount of the overpayment was $3,721.66.  This notice further               
          stated that respondent was considering petitioner’s claim for an            
          overpayment, but that the period of limitations might have                  
          expired.  In October 1989, respondent applied a portion of the              
          1982 overpayment as follows:  $1,300.34 to petitioner’s                     
          outstanding 1981 tax liability and $1,421.07 to petitioner’s                
          outstanding 1980 tax liability.  In November 1989, respondent               
          issued but immediately canceled a refund check to petitioner in             
          the amount of $1,160.52.  This amount reflects the $1,000.25                
          which was remaining from the 1982 overpayment, as well as $160.27           
          of accrued interest.  Petitioner never received this check.                 
               In the meantime, Golden Gate Associates, an entity related             
          to Neptune Associates, had been under examination by respondent             
          and had been involved in litigation before this Court.  Golden              
          Gate Associates agreed to a stipulated decision which was entered           
          by this Court on August 20, 1996.  On June 30, 1997, as a result            
          of the stipulated decision, petitioner was assessed, as a                   
          computational adjustment, an additional tax liability of $4,210             
          for 1982, plus $17,166 in accrued interest.                                 
               Petitioner requested that respondent abate the interest with           
          respect to his 1982 taxable year.  The explanation for his claim            
          was as follows:                                                             
                    This claim for refund of interest is being filed as the           
               result of a 1982 tax shelter recently concluded.  A 1982               

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