- 87 -
We incorporate the foregoing stipulations in the relief we
announce today.46
As for the deficiencies themselves, petitioners and
respondent have agreed that the originally determined Kersting
deficiencies should be reduced in proportion to the monetary
benefit the Thompsons received as a result of the new agreement
between McWade and DeCastro. As petitioners explain: “To
determine a percentage reduction of aggregate deficiencies
requires a numerator and denominator, the numerator being the
amount the Thompsons actually paid under the settlement and the
denominator being the amount they would have paid absent the
settlement.”47 We agree, with the initial caveat that, inasmuch
as the parties address both interest and Kersting-related
penalties elsewhere, we disregard those items in determining what
the Thompsons paid (the numerator) and would have paid (the
denominator).
46We do not adopt all aspects of the parties’ stipulation of
settled issues. See infra note 67.
47Actually, the resulting percentage would represent the
proportion of proposed deficiencies that affected taxpayers would
be required to pay. To obtain the “percentage reduction” it will
be necessary to subtract the percentage so found from 100
percent.
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