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agreement with the TMPs of the partnerships in which petitioners
had an interest before starting collection activity at their
level.
The Appeals officer determined that the delay in
petitioners’ learning of their snowballing liability is a matter
they should address with the TMPs of their partnerships. We
agree. TEFRA contemplates that it is generally a TMP’s
responsibility to keep his partners informed.3 Sec. 6233(g);
sec. 301.6223(g)-1T, Temporary Proced. & Admin. Regs., 52 Fed
Reg. 6785 (Mar. 5, 1987). We decline to decide that the failure
of the IRS to contact petitioners sooner is reason to compel
respondent to accept a settlement of approximately 7 percent of
petitioners’ interest liability.
We do agree with petitioners that there is something
disconcerting about their not receiving notice of the
ramifications for them of the Swanton coal litigation until 1999.
Indeed, respondent’s determination notes that petitioners may
have received no correspondence at all from their TMPs since
3 One part of respondent’s determination regarding the long
delay between Kelley and assessment does seem mistaken. The
Appeals officer found that “no link had been established” between
the Swanton Coal Programs and petitioners’ tax liabilities. This
statement is fundamentally in error if it was intended to mean
that Kelley did not at least indirectly affect petitioners’ tax
liabilities. Nevertheless, it appears to be dictum. Regardless
of the interrelation of the partnerships involved in the Swanton
Programs, respondent is correct that legal responsibility for
more promptly notifying petitioners and trying to resolve their
partnerships’ tax issues lay ultimately with their TMPs.
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Last modified: May 25, 2011