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creating classifications and distinctions in tax statutes.”
Regan v. Taxation With Representation, 461 U.S. 540, 547 (1983).
In Durham v. Commissioner, T.C. Memo. 2004-125, we rejected a
taxpayer’s argument that Congress unfairly discriminated between
similarly situated taxpayers by making the interest abatement
provisions of newly amended section 6404(e) effective only for
interest accruing with respect to deficiencies or payments for
tax years beginning after enactment of that section and not to
all instances of managerial errors committed after amendment of
section 6404(e). In Durham we stated:
judicial deference [to statutory classifications] flows
from a recognition that--as a practical matter--
Congress will often have to draw distinctions between
different taxpayers who seem in some ways to be in
similar positions. “No scheme of taxation, whether the
tax is imposed on property, income, or purchases of
goods and services, has yet been devised which is free
of all discriminatory impact.” As with laws granting
economic benefits, drawing distinctions “inevitably
requires that some persons who have an almost equally
strong claim to favored treatment be placed on
different sides of the [same] line . . . .” Yet courts
have repeatedly held that these distinctions do not
violate the Constitution’s guarantee of equal
protection. Instead they reflect Congress’s exercise
of its legitimate prerogative to enact laws with an eye
to their practical administration and cost to the fisc.
Id. (fn. refs. and citations omitted). The distinction between a
“partnership” and a “small partnership” for purposes of section
6231(a)(1)(B) does not impinge upon a fundamental right or use a
suspect classification and must therefore be upheld if it has any
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