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installment agreement were instead applied by respondent to a
1991 liability which was itself invalidly assessed after
expiration of the period of limitations on assessment for 1991.
Moreover, petitioners contend, overpayment credits from their
1995 and 1996 taxable years of $1,849 and $1,829.58,
respectively, as well as levies in 1996 and 1997, were likewise
applied by respondent against the invalidly assessed liability
for 1991, and those credits and levies should have been available
to satisfy the 1993 liability that respondent now asserts.
Our review of the record in this case, including the Forms
4340 covering petitioners' 1991 through 1997 taxable years,
persuades us that petitioners are correct in asserting that
respondent improperly applied their 1993 installment agreement
payments against a 1991 liability (and, to a small extent, a 1992
liability). The parties have stipulated that petitioners had an
installment agreement to pay their 1993 income tax liability and
that petitioners made some payments thereunder (although neither
party produced a copy of the agreement). The Form 4340 for 1993
does not record any payments' having been credited against that
year's liability, however. Mr. Richard's uncontradicted
testimony was that the 1993 installment agreement was entered
into in 1998. The Form 4340 for 1991 records a payment credited
against that year's liability of $337 on July 19, 1998, followed
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