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Form 866, Agreement as to Final Determination of Tax Liability.
Urbano v. Commissioner, supra; Zaentz v. Commissioner, supra. A
second type of closing agreement finally determines one or more
separate items affecting the taxpayer’s liability and is executed
on Form 906. Urbano v. Commissioner, supra; Zaentz v.
Commissioner, supra; see sec. 601.202, Statement of Procedural
Rules.
A closing agreement on Form 906, covering specific matters,
binds the parties as to the matters agreed upon. Zaentz v.
Commissioner, supra. This type of closing agreement does not,
however, conclusively determine the taxpayer’s tax liability for
that year. For example, this type of closing agreement does not
bar the Commissioner from subsequently determining that a
taxpayer is liable for additions to tax.4 Estate of Magarian v.
Commissioner, 97 T.C. 1 (1991).
4A requesting spouse is not entitled to innocent spouse
relief when the requesting spouse has entered into a closing
agreement that disposes of the same liability. See sec. 1.6015-
1(c)(1), Income Tax Regs. A closing agreement entered into
before the effective date of sec. 6015, however, does not cut off
a claim for innocent spouse relief under that section. Hopkins
v. Commissioner, 120 T.C. 451 (2003). Under the former innocent
spouse relief statute, sec. 6013(e), a closing agreement, even
one that determined liability only with regard to specific
issues, precluded a taxpayer’s later claim for innocent spouse
relief where the defense was not preserved in the text of the
closing agreement. See Hopkins v. United States, 146 F.3d 729
(9th Cir. 1998).
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Last modified: May 25, 2011