Susan G. Kilburg - Page 8

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          $68,713.  Timely filed amendment No. 1, at line 1, column A, also           
          incorrectly shows a negative $52,690 as the previously reported             
          gross income.  Amendment No. 1 reports a corrected adjusted gross           
          income of negative $150,132.  The revised Form 1040 for 1996                
          attached to amendment No. 1 shows the same amount for total and             
          adjusted gross income.  During the examination of the 1998                  
          return, petitioner produced a copy of a handwritten note using              
          the same language as above but claiming a loss of $150,132, which           
          note is alleged by petitioner to have been attached to amendment            
          No. 1.                                                                      
               The Court is not convinced that petitioner's handwritten               
          notes were attached to the returns when they were received by the           
          Internal Revenue Service.  The Court will, nevertheless, assume             
          for purposes of discussion that they were.  The question remains            
          as to the efficacy of the notes to waive successfully the                   
          carryback period.                                                           
               The essence of the statute is an unequivocal and binding               
          communication of an election to waive the carryback period.  See            
          Young v. Commissioner, 83 T.C. at 839.                                      
               In each note, petitioner listed an amount of NOL intended to           
          be carried forward and the year from which it was being carried             
          forward.  The amount listed on the original return did not jibe             
          with the amount in the handwritten note.  The amount listed in              
          the undated handwritten note that petitioner alleges was attached           

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