- 22 -
United States, supra. The District Court ordered the repayment,
and petitioners had not waived the restrictions on assessment
which arose when the partnership action was filed in the Tax
Court. The District Court specifically noted in the Order that
the amount petitioners had paid was a prerequisite to filing the
action in District Court. The District Court also ordered the
repayment to include interest, thus putting petitioners in the
position they were in before filing the amended returns and
protective claims, which meant the petitioners remained liable for
the entire potential deficiencies and penalties that could result
from the Tax Court partnership case and this current matter.
Respondent’s representative in the District Court action
asserted the remittance made by petitioners could not be assessed
at that time, and we agree. We do not find the remittance was an
unassessed amount collected as a deficiency.
In conclusion, we hold that respondent has correctly computed
the amount of the underpayment of tax related to the section
6653(a)(2) addition to tax.
The remaining issue is the addition to tax under section 6659
for a valuation overstatement of at least 150 percent of the
amount determined to be correct on any return. Section 6659 has
since been repealed but was applicable at the time the partnership
return was filed. The addition to tax has previously been held to
be applicable to carryback years before its enactment. See
Page: Previous 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Next
Last modified: November 10, 2007