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Commissioner has permitted the use of amended income tax returns,
amended returns are creatures of administrative convenience, and,
except as otherwise provided by regulations, the Commissioner is
free to accept or reject them. Terrell v. Commissioner, T.C.
Memo. 1986-507. Here, respondent did not accept petitioners’
amended return.
On May 23, 2002, petitioners filed a motion for summary
judgment with the Court. In the motion, petitioners argued for
interest abatement, relief from AMT, and a maximum capital gains
tax rate of 20 percent. Petitioners stated in the motion that
capital gains should not be included in adjusted gross income and
the capital gains tax should be determined at a 20-percent rate
separate from the regular tax computation. Petitioners’ motion
for summary judgment was denied on July 8, 2002.
At trial, petitioners raised the same capital gains tax
arguments asserted in their amended tax return and motion for
summary judgment. Additionally, petitioners claimed that they
are entitled to interest abatement because of ministerial and
managerial errors committed by employees of the Internal Revenue
Service.
Capital Gains Tax Rates
Petitioners argue that the $32,029 of gain not previously
included in income should be taxed at only 20 percent.
Respondent asserts that the $32,029 is unrecaptured section 1250
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Last modified: May 25, 2011