Robert B. Kemp, Jr. - Page 8

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          interest would be widely perceived as grossly unfair.”  S. Rept.            
          99-313, at 208 (1986), 1986-3 C.B. (Vol. 3) 1, 208; H. Rept. 99-            
          426, at 844 (1985), 1986-3 C.B. (Vol. 2) 1, 844.  We have                   
          jurisdiction to order an abatement of interest where the                    
          Commissioner’s failure to do so is an abuse of discretion.  Sec.            
          6404(i)(1).4                                                                
               Petitioner seeks an abatement of all interest accrued with             
          respect to the fraud penalties for 1989 and 1990, in effect                 
          claiming that the abatement should cover the entire period back             
          to the due date of the returns for those years.  Invoking section           
          301.6404-2T, Example (2), Temporary Proced. & Admin. Regs.,                 
          supra,5 petitioner contends that respondent’s October 4, 1999               
          issuance of the notice of deficiency determining the 1989 and               
          1990 fraud penalties was a ministerial act that was improperly              
          delayed, since respondent possessed all information and had                 
          completed all consultations with respect to these penalties by              
          August 1995.  Further, petitioner argues, the imposition of                 
          interest in these circumstances would be “widely perceived as               
          grossly unfair” because respondent delayed asserting the 1989 and           
          1990 fraud penalties as a “litigation tactic” in the proceedings            


               4 In 2002, sec. 6404(i) was redesignated sec. 6404(h).                 
          Victims of Terrorism Tax Relief Act of 2001, Pub. L. 107-134,               
          sec. 112(d)(1)(B), 115 Stat. 2434 (2002).                                   
               5 For taxable years beginning after July 30, 1996, this                
          regulation has been amended and made final.  See sec. 301.6404-             
          2(d), Proced. & Admin. Regs.                                                




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