Ralph Tashjian - Page 11

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               Where the validity of the underlying tax liability is at               
          issue, the Court will review the matter de novo.  Davis v.                  
          Commissioner, 115 T.C. 35, 39 (2000).  Where the taxpayer                   
          challenges the assessment procedures of the case, the Court will            
          review the matter for abuse of discretion.  Sego v. Commissioner,           
          114 T.C. 604, 610 (2000); Goza v. Commissioner, supra.  In order            
          to prevail under abuse of discretion, a taxpayer must prove that            
          the Commissioner exercised this discretion arbitrarily,                     
          capriciously, or without sound basis in fact or law.  Woodral v.            
          Commissioner, 112 T.C. 19, 23 (1999).                                       
               It is unclear which position petitioner has taken.                     
          Petitioner argues:                                                          
               The TEFRA jurisdiction did not lie due to non-formation                
               of the partnership entities according to law, failure                  
               to have a valid * * * [TMP] represent Petitioner within                
               the scope of TEFRA legislative intent, failure of                      
               Respondent to follow TEFRA procedures in identifying                   
               and selecting a proper * * * [TMP], and failure to                     
               treat Petitioner’s criminal investigation as a                         
               conversion of partnership items to non-partnership                     
               items.  The combined effects of these errors caused the                
               TEFRA assessments to be ineffective as against                         
               Petitioner.  * * *                                                     
          The TEFRA procedures as they relate to the partnerships and                 
          petitioner’s challenge of the TMP’s representation of the                   
          partnerships are discussed below.                                           
               Petitioner argues that the decision in Lumenetics v.                   
          Commissioner, T.C. Memo. 1992-630, should be void for lack of               
          jurisdiction because:  (1) The TEFRA audit procedures were                  
          inapplicable to the partnerships because they were improperly               

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Last modified: May 25, 2011