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promoters for their participation in the coal-mining shelters.
These conclusions were based upon their complicity in backdating
documents and failing to deliver promissory notes. Here, in
contrast, there is no evidence of Mr. Thompson’s engaging in any
backdating, failure to make delivery, or any other dishonesty
“upon which, in large part” we relied in finding fraud in Popkin
and Fried.
In sum, there is not now, nor was there ever before, any
basis to assert fraud against Mr. Thompson for 1982.
Accordingly, the period of limitations for that year expired in
May 1986. That being the case, the Thompsons’ 1982 tax year was
not an open year to which DeCastro’s August 3, 1989, letter to
McWade could have applied. We find and hold that the Thompsons’
1982 taxable year was not affected by, and was not part of, the
Thompson settlement.59
59 In all likelihood, the Thompsons’ 1982 tax year simply
slipped through the cracks as a result of the haphazard operation
of the audit lottery. The record in these cases reveals numerous
other instances in which respondent failed to catch all the
taxable years of all the Kersting deductions claimed by
participants in Kersting’s shelters. For example, test case
petitioners Richard and Fiorella Hongsermeier escaped audit for
their 1981 and 1982 taxable years, and respondent acknowledges
that the IRS “missed” the 1984 through 1986 taxable years of
other Kersting petitioners.
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