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Section 6330 and Liability for 2001
Our jurisdiction in this case is predicated upon section
6330(d)(1)(A), which gives the Tax Court jurisdiction “with
respect to such matter” as set forth in the determination of the
Appeals Office. Greene-Thapedi v. Commissioner, 126 T.C. 1, 6
(2006); Freije v. Commissioner, 125 T.C. 14, 25 (2005).
Petitioners originally reported almost $2 million in AMT
liability for 2000 as a result of Mr. Chou’s exercise of his
Cisco options. Stunned by the consequence and unable to secure
relief through an OIC, petitioners then filed amended returns
claiming that the liability should have been reported in 2001,
when it would be substantially lower because of the reduced value
of the stock. Petitioners now contend that, by assessing the tax
based on their amended 2001 return, the IRS “accepted” their
position and is required, by the “duty of consistency”, to abate
the liability for 2000.
In their amended returns, in their OIC, and in their briefs,
petitioners assert that the capital gains holding period under
section 422 renders the stock that they acquired through exercise
of Cisco ISOs nontransferable for 12 months without “forfeiture”
of the favorable tax rates on capital gains. Their argument
cites section 83(a), which deals with the time for recognizing
income from property transferred in connection with the
performance of services. This “risk of forfeiture” argument is
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