- 25 -
$3,000 capital loss limitation. The taxpayers in Lehrer are the
classic example of taxpayers who seek to use the benefit of
hindsight.15 The taxpayers sought retroactively to convert their
capital losses into ordinary losses several years later, with
continued trading in the interim, in order to escape a deficiency
and a section 6662 accuracy-related penalty. Lehrer stands in
marked contrast to the instant case, where petitioner filed his
election in the tax year it should have been filed, only a matter
of months after the due date under the revenue procedure, with no
trading in the interim, and no accuracy-related penalty was
determined. In sum, we hold that petitioner did not use
hindsight in requesting relief and that he acted reasonably and
in good faith.
Respondent contends that the interests of the Government are
deemed prejudiced pursuant to section 301.9100-3(c)(2), Proced. &
Admin. Regs., which provides in pertinent part as follows:
(2) Special rules for accounting method regulatory
elections.-- The interests of the Government are deemed
to be prejudiced except in unusual and compelling
circumstances if the accounting method regulatory
election for which relief is requested–
(i) Is subject to the procedure described in
�1.4461(e)(3)(i) of this chapter (requiring the
advance written consent of the Commissioner);
15The taxpayers in Lehrer v. Commissioner, T.C. Memo. 2005-
167, did not raise the issue of sec. 9100 relief. We held that
the taxpayers failed to file within the time prescribed by Rev.
Proc. 99-17, supra.
Page: Previous 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 NextLast modified: May 25, 2011