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without regard to interest) by agreeing to pay to the
United States $12,000 for tax years 1990, 1991, 1992,
and 1993, collectively. My calculations assume that
the additional liability would be allocated in the
following amounts: $5,000 to the 1991 tax year; $1,000
for the 1992 tax year; $1,000 for the 1993 tax year,
[sic] and $5,000 to the 1994 tax year. This offer is
in addition to the $42,873.24 paid to the United States
on or about December 30, 1997 as restitution in the
criminal proceedings entitled United States of America
v. James Owen Jondahl (D.C. ND; Case No. 3:97-CR-9).
On May 10, 2004, respondent sent petitioner a letter rejecting
petitioner’s “Qualified Offer dated April 27, 2004.” Respondent
also indicated a willingness to “discuss settlement on more
reasonable terms”.2
On June 14, 2004, a trial was held and on March 24, 2005, we
issued Jondahl v. Commissioner, supra. Petitioner’s liability,
including the fraud penalty, for the 1990, 1991, 1992, and 1993
tax years computed pursuant to our holding in Jondahl and Rule
155 is $39,178.50. Petitioner now moves for the award of
litigation costs in the amount of $17,217.50, based on the
qualified offer conveyed in his April 27, 2004, letter.
2After our decision in Jondahl v. Commissioner, T.C. Memo.
2005-55, petitioner sent respondent a letter requesting
litigation costs based on his qualified offer of Apr. 27, 2004.
At first, respondent informed petitioner that he was not entitled
to litigation costs because “the restitution payment plus the
additional $12,000” was less than the amount petitioner owed.
Subsequently, in a letter dated Aug. 9, 2005, respondent rejected
petitioner’s request for litigation costs because petitioner’s
Apr. 27, 2004, letter was not a qualified offer under sec.
7430(g) and sec. 301.7430-7(c)(3), Proced. & Admin. Regs.
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