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prematurely taking into account net operating loss (NOL)
carrybacks to 1993 in disregard of section 6601(d)(1).
We decide first whether petitioners may challenge in this
proceeding the existence and amount of the disputed interest.
We hold they may. We decide second whether we are empowered to
decide petitioners’ alternative claims that (1) the service
center’s recalculation of interest for 1993 was incorrect and
(2) respondent is precluded from collecting the amount reflected
in the recalculation. We hold we are. We decide third whether
the amount of the disputed interest, without consideration of any
abatement thereof, equals as of the time of the lien the amount
then sought by respondent. We hold it does. We decide fourth
whether any of the disputed interest qualifies for abatement
under section 6404(a)(1) or (e)(1). We hold it does not.
Background
The facts in this background section are obtained from the
parties’ stipulation of facts, the exhibits submitted therewith,
and the pleadings. Petitioners resided in Monarch Beach,
California, when their petition was filed.
Petitioners’ 1993 Federal income tax return reported for
that year that petitioners had negative total income of $113,381,
negative taxable income of $175,161, and Federal income tax of
zero. The return reported that the computation of total income
included interest income of $11,558, capital losses totaling
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