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had with Mr. Walker that he would report one-half of the gain
resulting from the sale of petitioner’s undivided 50-percent
interest in the Happy Valley property. In essence, petitioner
argues that, even though she incorrectly reported the amount of
the gain that she realized on the sale of her interest in the
Happy Valley property on her 1997 and 1998 returns, we should
conclude that she believed that such an agreement could shift a
portion of her tax liability to Mr. Walker. Respondent counters
by arguing that Mr. Walker never told petitioner, either orally
or in writing, that he would pay any amount of the tax resulting
from the sale of the Happy Valley property.
As discussed above, the alleged agreement that petitioner
argues existed between herself and Mr. Walker would not have
relieved her from her duty to assess her correct tax liability
for 1997 and 1998. See Pesch v. Commissioner, 78 T.C. at 129;
Neeman v. Commissioner, 13 T.C. at 399; Estate of Ballantyne v.
Commissioner, T.C. Memo. 2002-160; Bonner v. Commissioner, T.C.
Memo. 1979-435. Furthermore, the evidence of the alleged
agreement is conflicting and unreliable. Petitioner’s purported
belief is ultimately attributed by her to the agreement that she
would receive $500,000 in the divorce settlement free of tax and
not to any agreement with Mr. Walker at the time of the 1997
transfers of the Happy Valley property. The Settlement
Agreement’s terms, to the contrary, suggest that petitioner would
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