John B. Roberts, Jr., and Jean Roberts - Page 4

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               With respect to the years at issue in this case, petitioners           
          filed Federal income tax returns in which all or a portion of the           
          taxes shown on the returns was not paid.  Petitioners were                  
          assessed the taxes shown on their returns.  No notice of                    
          deficiency was ever issued to petitioners for any of the years              
          included in this petition, but petitioners are not challenging              
          the underlying deficiencies.  Instead, petitioners claim that               
          their tax liabilities for the taxable years 1992, 1993, and 1997            
          have been fully satisfied by intermittent payments made                     
          throughout 1996 and 1997 and the application of overpayment                 
          credits from the years 1996 to 2000 and 2002.  Petitioners also             
          contend that their tax liability for the taxable year 1988 was              
          fully satisfied during the 1990 bankruptcy through the collection           
          by respondent of a second mortgage held by petitioner husband.              
               Petitioners’ bankruptcy petition reflects the assignment of            
          the second mortgage to the IRS to satisfy tax deficiencies for              
          several preceding years, and petitioners claim the deficiencies             
          satisfied by the assignment included 1988.  Petitioner husband              
          testified he intended all payments made throughout 1996 and 1997            
          to be applied against the 1992 deficiency because the 1988                  
          deficiency was satisfied by the assignment; however, respondent             
          applied them to both the 1988 and the 1992 deficiencies.                    
          Respondent does not dispute the receipt of periodic payments from           
          petitioners but contends that the mortgage satisfaction did not             






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