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petitioners’ long-term capital loss while potentially adding a
long-term capital gain.
Petitioners argue that respondent could and should have
assessed tax as to the computational adjustment concerning the
long-term capital gain when no one timely filed a petition as to
the FPAA. We disagree. Petitioners rely erroneously on Olson v.
United States, 172 F.3d 1311 (Fed. Cir. 1999), and Bob Hamric
Chevrolet, Inc. v. United States, 849 F. Supp. 500 (W.D. Tex.
1994), to support their argument. Unlike there, respondent could
not have made an assessment as to the long-term capital gain
determination simply by examining petitioners’ 1999 Federal
income tax return and making mere ministerial adjustments. See,
e.g., Olson v. United States, supra at 1318. In fact,
petitioners’ 1999 Federal income tax return does not even
reference the object of the sale underlying the claimed long-term
capital loss.14 Nor do the distributions reported on DIP’s 1999
14 Petitioners signed their 1999 Federal income tax return
on Apr. 14, 2000, and filed the return on or before Aug. 18,
2000. The return, which was self-prepared, claimed that
petitioners had realized a $210,680 passthrough loss from
petitioner’s grantor trust and did not include any further
explanation as to the loss. Petitioner reported the long-term
capital loss on a 1999 Form 1041, U.S. Income Tax Return for
Estates and Trusts, filed on behalf of his grantor trust. The
Form 1041 reported that a long-term capital loss of $5,858,801
was realized during the year “From Partnership, S Corps. &
Fiduciaries” and that the loss was “Other K-1 Information”. (The
Form 1041 did not include any Schedule K-1, Shareholder’s Share
of Income, Credits, Deductions, etc.) The Form 1041 was prepared
by BDO Seidman on May 16, 2000, signed by petitioner on Oct. 25,
(continued...)
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