Estate of Algerine Allen Smith, Deceased, James Allen Smith, Executor - Page 71

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          disagreement that the figures shown are in accordance with the              
          findings and conclusions of the Court.”  Rule 155(a), Tax Court             
          Rules of Practice and Procedure.                                            
               That’s what the estate and the Commissioner did here.                  
          Counsel for the estate signed the agreed decision documents based           
          on the agreed computations, aware that the line item marked                 
          “overpayment” did not reflect unpaid interest.  This is not                 
          surprising:  Rule 155 governs all post-opinion computations                 
          (including computations of deficiency), and over time the IRS has           
          developed an almost-unbroken custom of using Rule 155 to reach              
          agreement on the amount of tax (rather than tax plus interest)              
          owed.  In fact, if interest computations are shown, they are to             
          be labeled “for information only,” Internal Revenue Manual                  
          8.17.3.2.3 Applying Credits and Payments (2001), which is exactly           
          what the parties did here.  See Form 3623, Statement of Account             
          Sched. 3.  We then typically review any resulting disputes about            
          the amount of tax owed under Rule 155(b) and disputes about the             
          interest computations under Rule 261.                                       
               In this case, the estate, through counsel, had the                     
          opportunity to review the statement of account that the                     
          Commissioner prepared.  This document clearly shows that                    
          interest and tax were to be considered and treated separately,              
          that “overpayment” meant overpayment of tax only and “interest”             
          included only interest assessed after the Court’s initial                   






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Last modified: May 25, 2011