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motivated) rate under section 6621(a). The settlement offered by
respondent in January 1993 did not include the burnout feature
canceling the accrual of interest for the first year for which
multiyear deficiencies had been determined.
Respondent’s letters further stated: “Acceptance of this
settlement offer will preclude any further challenge or appeal
with respect to the Kersting programs or the merits of the Dixon
opinion.” The letter contained a “Sample Analysis” illustrating
a hypothetical taxpayer who owed $20,000 in Kersting-related
deficiencies for the taxable year 1985. The analysis indicated
that, if the taxpayer accepted the new 7-percent reduction
settlement offer, he or she would owe a total of $36,388 in tax
and interest. However, if the taxpayer did not accept the
settlement, the taxpayer would owe $67,901 under the piggyback
arrangement as given effect in accordance with this Court’s 1991
opinion.
Petitioners’ Settlements
Respondent made the initial mass mailing on January 8, 1993,
and sent copies to petitioners in the present cases. Because
counsel for various petitioners complained they had not received
the settlement proposal letters, respondent remailed them to
those counsel on January 29, 1993. Respondent sent Mr.
O’Donnell, as first counsel of record for petitioners in the
present cases, copies of identical letters dated January 8 and
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