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that induced another to act to his or her detriment. Wilkins v.
Commissioner, 120 T.C. 109, 112 (2003); Hofstetter v.
Commissioner, 98 T.C. 695, 700 (1992). In tax contexts,
equitable estoppel will be applied against the Government only
with the utmost caution and restraint and upon the establishment
of prerequisite elements: (1) A false representation or
wrongful, misleading silence by the party against whom the
estoppel is claimed; (2) an error in a statement of fact and not
in an opinion or statement of law; (3) ignorance of the true
facts by the taxpayer; (4) reasonable reliance by the taxpayer on
the acts or statements of the one against whom estoppel is
claimed; and (5) adverse effects suffered by the taxpayer from
the acts or statements of the one against whom estoppel is
claimed. Wilkins v. Commissioner, supra at 112; Norfolk S. Corp.
v. Commissioner, 104 T.C. 13, 60 (1995), affd. 140 F.3d 240 (4th
Cir. 1998); see also Lignos v. United States, 439 F.2d 1365, 1368
(2d Cir. 1971).
Here, the record cannot sustain a claim for equitable
estoppel. Fundamentally, petitioners did not act to their
detriment in reliance upon any false representation by
respondent. Petitioners chose to report the KEEAP II payment as
capital gain based upon advice from third parties, and they have
not alleged that communications from respondent played any part
in that decision. Because petitioners’ belief in their
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