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a. The United States Tax Court, as af-
firmed by the United States Court of
Appeals for the Eighth Circuit ruled
that certain income was taxable to Peti-
tioners for 1988 based upon a Revenue
Agents report. That same income had
been reported by Petitioners’ corpora-
tion its 1998 income tax return. Peti-
tioners filed Form 1040X, Amended U.S.
Individual Income Tax Return in order to
correct the duplication. The U.S. Su-
preme Court, in U.S. v. Supplee-Biddle
Hardware Co., 265 U.S. 189, ruled that
“Such duplication even in an exigent war
tax measure is to be avoided.” Respon-
dent has not responded to nor taken any
action respecting Form 1040X.
Petitioner had requested that this issue
be considered at the Collection Due
Process Hearing. [Reproduced
literally.]
Upon reviewing respondent’s administrative record with
respect to petitioners’ taxable year 1988, respondent’s counsel
discovered that the $67,978.11 addition to tax under section
6653(a) that respondent assessed on June 5, 2001, exceeded the
amount of the addition to tax under section 6653(a) in the Tax
Court decision, which was $2,777.50. Upon the request of respon-
dent’s counsel, the settlement officer reviewed the assessments
that respondent made with respect to petitioners’ taxable year
1988 and took the action necessary to have the addition to tax
under section 6653(a) and interest thereon abated to the extent
they exceeded the addition to tax under section 6653(a) in the
Tax Court decision and interest thereon.
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Last modified: November 10, 2007