Free Motion to Dismiss - Rule 12(b)(1) - District Court of Federal Claims - federal

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APPENDIX A

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26 USCA § 6166 26 U.S.C.A. § 6166
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UNITED STATES CODE ANNOTATED

TITLE 26. INTERNAL REVENU CODE SUBTITLE F--PROCEDUR AN ADMIISTRATION CHAPTER 62--TIME AN PLACE FOR PAYING TAX SUBCHAPTER B--EXTENSIONS OF TIME FOR PAYMENT
Copr. ~ West Group 1999. No Claim to Orig. U.S. Govt. Works

§ 6166. Extension of time for payment of estate tax where estate consists largely of interest in closely held business
(a) 5-year deferral; lO-year installment payment.-(1) In general.-- If the value of an interest in a closely held business which is included in determining the gross estate of a decedent who was (at the date of his death) a citizen or resident ofthe United States exceeds 35 percent of the the tax imposed by section 2001 in 2 or more (but not adjusted gross estate, the executor may elect to pay par or all of
exceeding 10) equal installments.

(2) Limitation.-- The maximum amount of tax which may be paid in installments under this subsection shall be an
amount which bears the same ratio to the ta imposed by section 2001 (reduced by the credits against such ta) as--

(A) the closely held business amount, bears to
(B) the amount of

the adjusted gross estate.

(3) Date for payment of installments.--If an election is made under paragraph (1), the first installment shall be paid
on or before the date selected by the executor which is not more than 5 years after the date prescribed by section 6151 (a) the ta, and each succeeding installment shall be paid on or before the date which is 1 year after the date for payment of

prescribed by this paragraph for payment of the preceding installment.

(b) Definitions and special rules.-means--

(1) Interest in closely held business.--For purposes of this section, the term "interest in a closely held business"
(A) an interest as a proprietor in a trade or business caried on as a proprietorship;
(B) an interest as a parer in a parership caring on a trade or business, if-(i) 20 percent or more of the total capital interest in such parership is included in determining the gross estate of

the

decedent, or
(ii) such parership had 15 or fewer parers; or

(C) stock in a corporation caring on a trade or business if-~ 2006 Thomsonlest. No Claim to Orig. U.S. Govt. Works.
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26 USCA § 6166 26 U.S.C.A. § 6166

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(i) 20 percent or more in value of

the voting stock of such corporation is included in determining the gross estateof

the decedent, or
(ii) such corporation had 15 or fewer shareholders.
(2) Rules for applying paragraph (l).--For purposes of

paragraph (1)-the time immediately before the decedent's death.

(A) Time for testing.--Determinations shall be made as of

(B) Certain interests held by husband and wife.--Stock or a parership interest which--

(i) is community propert of a husband and wife (or the income from which is community income) under the applicable community propert law of a State, or
(ii) is held by a husband and wife as joint tenants, tenants by the entirety, or tenants in common,

shall be treated as owned by one shareholder or one parter, as the case may be.
(C) Indirect ownership.--Propert owned, directly or indirectly, by or for a corporation, parership, estate, or trst
shall be considered as being owned proportionately by or for its shareholders, parers, or beneficiaries. For purposes

of the preceding sentence, a person shall be treated as a beneficiary of any trst only if such person has a present interest
in the trst.

decedent or by any member of

(D) Certain interests held by members of decedent's family.--All stock and all partership interests held by the section 267(c)(4)) shall be trejited as owned by the his family (within the meaning of

decedent.

the 35-percent requirement of subsection (a)(1), an interest in a closely held business which is the business offaring includes an interest in residential
(3) Farmhouses and certain other structures taken into account.--For purposes of buildings and related improvements on the far which are occupied on a regular basis by the owner or lessee of

the far

or by persons employed by such owner or lessee for purposes of operating or maintaining the far.
(4) V alue.-- F or purposes of this section, value shall be value determined for purposes of chapter 11 (relating to estate

tax).
(5) Closely held business amount.--For purposes of value of

this section, the term "closely held business amount" means the the interest in a closely held business which qualifies under subsection (a)(1).

this section, the term, "adjusted gross estate" means the value ofthe gross (6) Adjusted gross estate.--For purposes of estate reduced by the sum of the amounts allowable as a deduction under section 2053 or 2054. Such sum shall be the facts and circumstaces in existence on the date (including extensions) for fiing the return determined on the basis of
of tax imposed by section 2001 (or, if earlier, the date on which such retu is fied).

(7) Partnership interests and stock which is not readily tradable.-(A) In general.--Ifthe executor elects the benefits of

this paragraph (at such time and in such manner as the Secretar

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(i) for purposes of

paragraph (1 )(B)(i) or (1 )(C)(i) (whichever is appropriate) and for purposes of subsection (c), any

capital interest in a parership and any non-readily-tradable stock which (after the application of paragraph (2)) is treated

as owned by the decedent shall be treated as included in determining the value of the decedent's gross estate,

(ii) the executor shall be treated as having selected under subsection (a)(3) the date prescribed by section6151(a), and

(ii) section 66010) (relating to 4-percent rate of interest) shall not apply.
(B) Non-readily-tradable stockdefined.--Forpurposes of stock for which, at the time of

this paragraph, the term "non-readily-tradablestock" means the decedent's death, there was no market on a stock exchange or in an over-the-counter

market.

(8) Stock in holding company treated as business company stock in certain cases.-(A) In general.--Ifthe executor elects the benefits of

this paragraph, then--

(i) Holding company stock treated as business company stock.--For purposes of

this section, the portion ofthe

stock of any holding company which represents direct ownership (or indirect ownership through 1 or more other holding companies) by such company in a business company shall be deemed to be stock in such business company.
(ii) 5-year deferral for principal not to apply.-- The executor shall be treated as having selected under

subsection

(a)(3) the date prescribed by section 6151(a).
(ii) 4-percent interest rate not to apply.--Section 66010) (relating to 4-percent rate of

interest) shall not apply.

(B) All stock must be non-readily-tradable stock.--No stock shall be taken into account for purposes of this paragraph unless it is non-readily-tradable stock (within the meaning of

applying

paragraph (7)(B)).

paragraph (1)(C), clause (i) of subparagraph (A) shall be treated as voting stock to the extent that the deemed stock resulting from the application of voting stock in the holding company owns directly (or through the voting stock of 1 or more other holding companies) voting stock in the business company.
(C) Application of voting stock requirement of paragraph (l)(C)(i).--Forpurposes of (D) Definitions.--For purposes of

this paragraph--

(i) Holding company.-- The term "holding company" means any corporation holding stock in another corporation.
(ii) Business company.-- The term "business company" means any corporation caring on a trade or business.

(9) Deferral not available for passive assets.-(A) In general.--For purposes of subsection (a)(l) and determining the closely held business amount (but not for

purposes of subsection (g)), the value of any interest in a closely held business shall not include the value of that portion
of such interest which is attibutable to passive assets held by the business.

(B) Passive asset defined.--For purposes of

this paragraph--

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(i) In general.-- The term "passive asset" means any asset other than an asset used in caring on a trade or business.
(ii) Stock treated as passive asset.-- The term "passive asset" includes any stock in another corporation unless--

(I) such stock is treated as held by the decedent by reason of an election under paragraph (8), and
(II) such stock qualified under subsection (a)(1).

(ii) Exception for active corporations.--If-(I) a corporation owns 20 percent or more in value of the voting stock of another corporation, or such other corporation has 15 or fewer shareholders, and
(II) 80 percent or more of the value of the assets of

each such corporation is attibutable to assets used in caring

on a trade or business,

then such corporations shall be treated as 1 corporation for purposes of clause (ii). For purposes of applying
subclause (II) to the corporation holding the stock of

the other corporation, such stock shall not be taken into account.
this section, interests in 2 or

closely held businesses, with respect to each of

more the decedent's gross the total value of each such business, shall be treated as an interest in a single closely held estate 20 percent or more of the preceding sentence, an interest in a closely held business the 20-percent requirement of business. For purposes of which represents the surviving spouse's interest in propert held by the decedent and the surviving spouse as community
(c) Special rule for interests in 2 or more closely held businesses.--Forpurposes of which there is included in determining the value of

propert or as joint tenants, tenants by the entirety, or tenants in common shall be treated as having been included in the decedent's gross estate. determining the value of
(d) Election.--Any election under subsection (a) shall be made not later than the time prescribed by section 6075(a) for fiing the return of tax imposed by section 2001 (including extensions thereof), and shall be made in such manner as the Secretary shall by regulations prescribe. Ifan election under subsection (a) is made, the provisions ofthis subtitle shall apply as though the Secretary were extending the time for payment of the tax.
(e) Proration of deficiency to installments.--If an election is made under subsection (a) to pay any par of

the tax

imposed by section 200 1 in installments and a deficiency has been assessed, the deficiency shall (subject to the limitation the deficiency provided by subsection (a)(2)) be prorated to the installments payable under subsection (a). The part of which has not arrived shall be collected at the same time as, and so prorated to any installment the date for payment of which payment of the deficiency so prorated to any installment the date for as a par of, such installment. The par of the deficiency has arived shall be paid upon notice and demand from the Secretary. This subsection shall not apply if is due to negligence, to intentional disregard of rules and regulations, or to fraud with intent to evade tax.
(I) Time for payment of interest.--Ifthe time for payment of any amount of

tax has been extended under this section--

(1) Interest for first 5 years.-- Interest payable under section 6601 of any unpaid portion of such amount attibutable to the first 5 years after the date prescribed by section 6151 (a) for payment of the tax shall be paid annually.
(2) Interest for periods after first 5 years.-- Interest payable under section 6601 on any unpaid portion of such amount attibutable to any period after the 5-year period referred to in paragraph (1) shall be paid anually at the same time as,
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and as a part of, each installment payment of

the tax.

assessed after the close of the 5-year period referred to in paragraph (1), interest attibutable to such 5-year period, and which has arrived on or before the date interest assigned under paragraph (2) to any installment the date for payment of
of the assessment of

(3) Interest in the case of certain deficiencies.-- In the case of a deficiency to which subsection (e) applies which is

the deficiency, shall be paid upon notice and demand from the Secretar.

(4) Selection of shorter period.-- Ifthe executor has selected a period shorter than 5 years under subsection (a )(3), such
shorter period shall be substituted for 5 years in paragraphs (1), (2), and (3) of

this subsection.

(g) Acceleration of payment.--

(1) Disposition of interest; withdrawal of funds from business.-(A) If-(i)(I) any portion of an interest in a closely held business which qualifies under subsection (a)(1) is distributed, sold, exchanged, or otherwise disposed of, or
(II) money and other propert attibutable to such an interest is withdrawn from such trade or business, and

(ii) the aggregate of such distributions, sales, exchanges, or other dispositions and withdrawals equals or exceeds 50 percent of the value of such interest,
then the extension of of of tax provided in subsection (a) shall cease to apply, and the unpaid portion time for payment the tax payable in installments shall be paid upon notice and demand from the Secretary.

(B) In the case of a distribution in redemption of

stock to which section 303 (or so much of section 304 as relates to

section 303) applies--

(i) the redemption of such stock, and the withdrawal of money and other propert distributed in such redemption, shall not be treated as a distribution or withdrawal for purposes of subparagraph (A), and

(ii) for purposes of subparagraph (A), the value of the interest in the closely held business shall be consideredto be such value reduced by the value of the stock redeemed.
This subparagraph shall apply only if, on or before the date prescribed by subsection (a)(3) for installment which becomes due after the date of the date of the distribution), there is paid an amount of

the paymentofthe first the distribution (or, if earlier, on or before the day which is 1 year after the tax imposed by section 2001 not less than the amount of

money and other propert distributed.
(C) Subparagraph (A)(i) does not apply to an exchange of stock pursuant to a plan of reorganization described in
subparagraph (D), (E), or (F) of section 368(a)(1) nor to an exchange to which section 355 (or so much of

section 356

as relates to section 355) applies; but any stock received in such an exchange shall be treated for purposes of
subparagraph (A)(i) as an interest qualifying under subsection (a)(1).
(D) Subparagraph (A)(i) does not apply to a transfer of propert of the decedent to a person entitled by reason of

the

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26 USCA § 6166
26 U.S.C.A § 6166

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decedent's death to receive such propert under the decedent's wil, the applicable law of descent and distribution, or a trst created by the decedent. A similar rule shall apply in the case of a series of subsequent transfers of the propert of section 267(c)(4)) ofthe of the family (within the meaning by reason of death so long as each transfer is to a member transferor in such transfer.

(E) Changes in interest in holding company.--Ifany stock in a holding company is treated as stock in a business company by reason of subsection (b )(8)(A)-(i) any disposition of any interest in such stock in such holding company which was included in determining the gross estate of the decedent, or
(ii) any withdrawal of any money or other propert from such holding company attibutable to any interest included

in determining the gross estate of the decedent,
shall be treated for purposes of subparagraph (a) as a disposition of (or a withdrawal with respect to) the stock

qualifying under subsection (a)(1).

(F) Changes in interest in business company.--Ifany stock in a holding company is treated as stock in a business company by reason of subsection (b )(8)(A)-(i) any disposition of any interest in such stock in the business company by such holding company, or

any money or other propert from such business company attibutable to such stock by such (ii) any withdrawal of holding company owning such stock,

shall be treated for purposes of subparagraph (a) as a disposition of (or a withdrawal with respect to) the stock qualifying under subsection (a)(1).

(2) Undistributed income of estate.-(A) If an election is made under this section and the estate has undistributed net income for any taxab1eyear ending on or after the due date for the first installment, the executor shall, on or before the date prescribed by law for fiing the income tax return for such taxable year (including extensions thereof), pay an amount equal to such undistributed net
income in liquidation of the unpaid portion of

the tax payable in installments.

(B) For purposes of subparagraph (A), the undistributed net income of by which the distributable net income of

the estate for any taxable year is the amount the estate for such taxable year (as defined in section 643) exceeds the sum of--

(i) the amounts for such taxable year specified in paragraphs (1) and (2) of section 661 (a) (relating to deductions for distributions, etc.);

(ii) the amount of tax imposed for the taxable year on the estate under chapter 1; and
(iii) the amount of the tax imposed by section 200 i (including interest) paid by the executor during the taxable year (other than any amount paid pursuant to this paragraph).
(C) For purposes of this paragraph, if

any stock in a corporation is treated as stock in another corporation by reason

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of subsection (b )(8)(A), any dividends paid by such other corporation to the corporation shall be treated as paid to the estate of the decedent to the extent attibutable to the stock qualifying under subsection (a)(I).

(3) Failure to make payment of principal or interest.-this section is of principal or interest under any payment (A) In general.--Except as provided in subparagraph (B), if not paid on or before the date fixed for its payment by this section (including any extension of time), the unpaid portion
of

the tax payable in installments shall be paid upon notice and demand from the Secretar.

(B) Payment within 6 months.-- If any payment of principal or interest under this section is not paid on or before the date determined under subparagraph (A) but is paid within 6 months of such date--

(i) the provisions of subparagraph (A) shall not apply with respect to such payment,
(ii) the provisions of section 660 i G) shall not apply with respect to the determination of interest on such payment, and

(iii) there is imposed a penalty in an amount equal to the product of--

(I) 5 percent of the amount of such payment, multiplied by (II) the number of months (or fractions thereof) after such date and before payment is made.
The penalty imposed under clause (iii) shall be treated in the same manner as a penalty imposed under subchapter B of chapter 68.
(h) Election in case of certain deficiencies.--

(1) In general.--If-(A) a deficiency in the tax imposed by section 2001 is assessed,

(B) the estate qualifies under subsection (a)(1), and

(C) the executor has not made an election under subsection (a),
the deficiency is due to negligence, to intentional disregard of rules and regulations, or to fraud with intent to evade tax.
the executor may elect to pay the deficiency in installments. This subsection shall not apply if (2) Time of election.--An election under this subsection shall be made not laterthan 60 days after issuance of and demand by the Secretary for the payment of

notice

the deficiency, and shall be made in such manner as the Secretar shall

by regulations prescribe.

(3) Effect of election on payment.--If an election is made under this subsection, the deficiency shall (subject to the limitation provided by subsection (a)(2)) be prorated to the installments which would have been due if an election had the deficiency so prorated been timely made under subsection (a) at the time the estate tax return was fied. The par of

to any installment the date for payment of which would have arrived shall be paid at the time of the making of the which the deficiency so prorated to installments the date for payment of election under this subsection. The portion of
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would not have so arrived shall be paid at the time such installments would have been due if such an election had been made.
(i) Special rule for certain direct skips.-- To the extent that an interest in a closely held business is the subject of a
direct skip (within the meaning of section 2612(c)) occurring at the same time as and as a result of

the decedent's death,

then for purposes of this section any tax imposed by section 2601 on the transfer of such interest shall be treated as if it were additional tax imposed by section 2001.

G) Regulations.-- The Secretar shall prescribe such regulations as may be necessar to the application of this section.

(k) Cross references.-(1) Security.--

F or authority of the Secretary to require security in the case of an extension under this section, see section 6165.
(2) Lien.-For special

lien (in lieu of bond) in the case of an extension under this section, see section 6324A.

(3) Period of limitation.-For extension of the period of limitation in the case of an extension under this section, see section 6503( d).
(4) Interest.--

F or provisions relating to interest on tax payable in installments under this section, see subsection 0) of section 6601.

(5) Transfers within 3 years of death.-For special rule for qualifying an estate under this section where propert has been transferred within 3 years of

decedent's death, see section 2035(d)(4).

((6) Repealed. Pub.L. 104-188, Title I, § 1704(t)(l5), Aug. 20, 1996, 110 Stat. 1888)

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26 USCA § 6213
26 U.S.C.A § 6213
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UNITED STATES CODE ANNOTATED TITLE 26. INTERNAL REVENUE CODE SUBTITLE F--PROCEDURE AND ADMINISTRATION CHAPTER 63--ASSESSMENT
SUBCHAPTER B--DEFICIENCY PROCEDURES IN THE CASE OF INCOME, ESTATE, GIFT, AND CERTAIN EXCISE TAXES
Copr. ~ West Group 1999. No Claim to Orig. U.S. Govt. Works

§ 6213. Restrictions applicable to deficiencies; petition to Tax Court
(a) Time for fiing petition and restriction on assessment.-- Within 90 days, or 150 days if

the notice is addressed to
taxpayer

a person outside the United States, after the notice of deficiency authorized in section 6212 is mailed (not counting

may fie a petition with the the deficiency. Except as otherwise provided in section 6851, 6852 or 6861, no Tax Court for a redetermination of assessment of a deficiency in respect of any tax imposed by subtitle A, or B, chapter 41, 42, 43, or 44 and no levy or proceeding in court for its collection shall be made, begun, or prosecuted until such notice has been mailed to the taxpayer, nor until the expiration of such 90-day or 150-day period, as the case may be, nor, if a petition has been fied with the Tax Court, until the decision of the Tax Court has become final. Notwithstanding the provisions of section such proceeding or levy during the time such prohibition is the beginning of such assessment or 7421(a), the making of in force may be enjoined by a proceeding in the proper court, including the Tax Court. The Tax Court shall have no the this subsection unless a timely petition for a redetermination of jurisdiction to enjoin any action or proceeding under
Saturday, Sunday, or a legal holiday in the District of Columbia as the last day), the

deficiency has been fied and then only in respect of the deficiency that is the subject of such petition.

(b) Exceptions to restrictions on assessment.-or clerical error appearing on the return, an amount of tax in excess of that shown on the return is due, and that an assessment of the tax has been orwil be made on the basis of what would have been the correct amount oftax but for the mathematical or clerical error, such notice shall not be considered as a notice of deficiency for the purposes the deficiency has been mailed), or of section of subsection (a) (prohibiting assessment and collection until notice of 6212( c)( 1) (restricting further deficiency letters), or of section 6512( a) (prohibiting credits or refunds after petition to the Tax Court), and the taxpayer shall have no right to fie a petition with the Tax Court based on such notice, nor shall this section. Each notice under this such assessment or collection be prohibited by the provisions of subsection (a) of paragraph shall set forth the error alleged and an explanation thereof.
mathematical

(1) Assessments arising out of mathematical or clerical errors.--Ifthe taxpayer is notified that, on account of a

(2) Abatement of assessment of mathematical or clerical errors.-(A) Request for abatement.--Notwithstanding section 6404(b), a taxpayer may fie with the Secretary within 60 days after notice is sent under paragraph (1) a request for an abatement of any assessment specified in such notice, and upon the tax with respect to which an receipt of such request, the Secretar shall abate the assessment. Any reassessment of abatement is made under this subparagraph shall be subject to the deficiency procedures prescribed by this subchapter.
(B) Stay of collection.-- In the case of any assessment referred to in paragraph (1), notwithstanding paragraph (1), no

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levy or proceeding in court for the collection of such assessment shall be made, begun, or prosecuted during the period in which such assessment may be abated under this paragraph.
(3) Assessments arising out of tentative carryback or refund adjustments.--Ifthe Secretary determines that the
amount applied, credited, or refunded under section 6411 is in excess of

the overassessment attibutable to the carrback

or the amount described in section 1341 (b)( 1) with respect to which such amount was applied, credited, or refunded, he

may assess without regard to the provisions of paragraph (2) the amount of the excess as a deficiency asif it were due to a mathematical or clerical error appearing on the return.

amount paid.--Any amount paid as a tax or in respect ofa tax may be assessed upon the receipt of (4) Assessment of such payment notwithstanding the provisions of subsection (a). In any case where such amount is paid after the mailing of a notice of deficiency under section 6212, such payment shall not deprive the Tax Court of jurisdiction over such deficiency determined under section 6211 without regard to such assessment.
(c) Failure to fie petition.--Ifthe taxpayer does not fie a petition with the Tax Court within the time prescribed in
subsection (a), the deficiency, notice of which

has been mailed to the taxpayer, shall be assessed, and shall be paid upon

notice and demand from the Secretary.
(d) Waiver of restrictions.-- The taxpayer shall at any time (whether or not a notice of deficiency has been issued) have the right, by a signed notice in writing fied with the Secretary, to waive the restrictions provided in subsection (a) on
the assessment and collection of the whole or any par of

the deficiency.

(e) Suspension of

fiing period for certain excise taxes.-- The running ofthe time prescribed by subsection (a) for fiing

a petition in the Tax Court with respect to the taxes imposed by section 4941 (relating to taxes on self-dealing), 4942 (relating to taxes on failure to distribute income), 4943 (relating to taxes on excess business holdings), 4944 (relating
to investments which

jeopardize charitable purpose), 4945 (relating to taxes on taxable expenditures), 4951 (relating to

taxes on self-dealing), or 4952 (relating to taxes on taxable expenditures), 4955 (relating to taxes on political

expenditures), 4958 (relating to private excess benefit), 4971 (relating to excise taxes on failure to meet minimum funding standard), 4975 (relating to excise taxes on prohibited transactions) shall be suspended for any period during
which the Secretar has extended the time allowed for making correction under section 4963(e).

(I) Coordination with title 11.-States Code, the running ofthe time prescribed by subsection (a) for fiing a petition in the Tax Cour with respect to any deficiency shall be suspended for the period during which the debtor is prohibited by reason of such case from fiing a petition in the Tax Court with respect to such deficiency, and for 60 days thereafter.
(2) Certain action not taken into account.--Forpuroses of ofa proof of claim or request for payment (or the taking of the second and third sentences of any other action) in a case under

(1) Suspension of running of period for filing petition in title 11 cases.-- In any case under title 11 of the United

subsection (a), the fiing
title 11 of

the United States

Code shall not be treated as action prohibited by such second sentence.
(g) Definitions.-- F or purposes of this section-(1) Return.--The term "return" includes any return, statement, schedule, or list, and any amendment

or supplement

thereto, fied with respect to any tax imposed by subtitle A or B, or chapter 41,42,43, or 44.

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(2) Mathematical or clerical error.-- The term "mathematical or clerical error" means-(A) an error in addition, subtraction, multiplication, or division shown on any return,
(B) an incorrect use of any table provided by the Internal Revenue Service with respect to any return if such incorrect use is apparent from the existence of other information on the return,
(C) an entr on a return of an item which is inconsistent with another entr of

the same or another item on such return,

(D) an omission of information which is required to be supplied on the return to substantiate an entr on the return,
(E) an entr on a return of a deduction or credit in an amount which exceeds a statutory limit imposed by subtitle A

or B, or chapter 41,42,43, or 44, if such limit is expressed-(i) as a specified monetar amount, or

(ii) as a percentage, ratio, or fraction,
and if the items entering into the application of such limit appear on such retu,

(F) an omission of a correct taxpayer identification number required under section 32 (relating to the earned income credit) to be included on a return,
(G) an entr on a return claiming the credit under section 32 with respect to net earings from self-employment described in section 32( c )(2)(A) to the extent the tax imposed by section 1401 (relating to se1f-employmenttax) on such
net earings has not been paid, and

services necessary for gainful employment)

(H) an omission of a correct TIN required under section 21 (relating to expenses for household and dependent care personal exemptions). or section 151 (relating to allowance of deductions for

(h) Cross references.-(1) For assessment as if a mathematical error on the return, in the case of erroneous claims for income tax prepayment 1 (a)(3).

credits, see section 620

(2) For assessments without regard to restrictions imposed by this section in the case of-(A) Recovery of

foreign income taxes, see section 905(c).

(B) Recovery offoreign estate tax, see section 2016.
(3) For provisions relating to application of

this subchapter in the case of certain parership items, etc., see section

6230(a).

~ 2006 Thomson/West. No Claim to Orig. U.S. Govt. Works.
1821027.1

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~f1a
26 USCA § 6213 26 U.S.C.A. § 6213
Page 1

UNITED STATES CODE ANNOTATED TITLE 26. INTERNAL REVENUE CODE SUBTITLE F--PROCEDURE AND ADMINISTRATION CHAPTER 63--ASSESSMENT
SUBCHAPTER B--DEFICIENCY PROCEDURES IN THE CASE OF INCOME, ESTATE, GIFT, AND CERTAIN EXCISE TAXES
Copr. te West Group 1999. No Claim to Orig. U.S. Govt. Works

§ 6213. Restrictions applicable to deficiencies; petition to Tax Court
(a) Time for fiing petition and restriction on assessment.-- Within 90 days, or 150 days if

the notice is addressed to

such proceeding or levy during the time such prohibition is in force may be enjoined by a proceeding in the proper court, including the Tax Court. The Tax Court shall have no this subsection unless a timely petition for a redetermination ofthe jurisdiction to enjoin any action or proceeding under
7421 (a), the making of such assessment or the beginning of

may fie a petition with the taxpayer as the last day), the Columbia Saturday, Sunday, or a legal holiday in the District of Tax Court for a redetermination ofthe deficiency. Except as otherwise provided in section 6851,6852 or 6861, no assessment of a deficiency in respect of any tax imposed by subtitle A, or B, chapter 41, 42, 43, or 44 and no levy or proceeding in court for its collection shall be made, begun, or prosecuted until such notice has been mailed to the taxpayer, nor until the expiration of such 90-day or 150-day period, as the case may be, nor, if a petition has been fied with the Tax Court, until the decision of the Tax Court has become final. Notwithstanding the provisions of section

a person outside the United States, after the notice of deficiency authorized in section 6212 is mailed (not counting

deficiency has been fied and then only in respect of the deficiency that is the subject of such petition.

(b) Exceptions to restrictions on assessment.--

(1) Assessments arising out of mathematical or clerical errors.--Ifthe taxpayer is notified that, on account of a
mathematical or clerical error appearing on the return, an amount of that an assessment of the tax has been orwil be made on the basis of tax in excess of what would have been the correct amount of

that shown on the return is due, and tax

but for the mathematical or clerical error, such notice shall not be considered as a notice of deficiency for the purposes the deficiency has been mailed), or of section of subsection (a) (prohibiting assessment and collection until notice of 6212(c)(1) (restricting further deficiency letters), orof section 6512(a) (prohibiting credits or refunds after petition to the Tax Court), and the taxpayer shall have no right to fie a petition with the Tax Court based on such notice, nor shall this section. Each notice under this such assessment or collection be prohibited by the provisions of subsection (a) of paragraph shall set forth the error alleged and an explanation thereof.

(2) Abatement of assessment of mathematical or clerical errors.-(A) Req uest for abatement.-- Notwithstanding section 6404(b), a taxpayer may fie with the Secretar within 60 days after notice is sent under paragraph (1) a request for an abatement of any assessment specified in such notice, and upon receipt of such request, the Secretar shall abate the assessment. Any reassessment of the tax with respect to which an abatement is made under this subparagraph shall be subject to the deficiency procedures prescribed by this subchapter.
(B) Stay of collection.-- In the case of any assessment referred to in paragraph (I), notwithstanding paragraph (i), no

te 2006 Thomson/West. No Claim to Orig. U.S. Govt. Works.

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26 USCA § 6213
26 U.S.C.A § 6213

Page 2

levy or proceeding in court for the collection of such assessment shall be made, begun, or prosecuted during the period in which such assessment may be abated under this paragraph.
(3) Assessments arising out of tentative carryback or refund adjustments.--Ifthe Secretar determines that the
amount applied, credited, or refunded under section 6411 is in excess of the overassessment

attibutable to the carback

or the amount described in section 1341 (b)( 1) with respect to which such amount was applied, credited, or refunded, he
may' assess without regard to the provisions of paragraph (2) the amount of

the excess as a deficiency asifit were due

to a mathematical or clerical error appearing on the return.
(4) Assessment of amount paid.--Any amount paid as a tax or in respect of a tax may be assessed upon the receipt of such payment notwithstanding the provisions of subsection (a). In any case where such amount is paid after the mailing of a notice of deficiency under section 6212, such payment shall not deprive the Tax Court of jurisdiction over such deficiency determined under section 6211 without regard to such assessment.
(c) Failure to fie petition.--Ifthe taxpayer does not fie a petition with the Tax Court within the time prescribed in

subsection (a), the deficiency, notice of which has been mailed to the taxpayer, shall be assessed, and shall be paid upon notice and demand from the Secretary.

(d) Waiver of restrictions.-- The taxpayer shall at any time (whether or not a notice of deficiency has been issued) have the right, by a signed notice in writing fied with the Secretar, to waive the restrictions provided in subsection (a) on
the assessment and collection of the whole or any par of

the deficiency.
the time prescribed by subsection (a) for fiing

(e) Suspension of

fiing period for certain excise taxes.-- The running of

a petition in the Tax Court with respect to the taxes imposed by section 4941 (relating to taxes on self-dealing), 4942 (relating to taxes on failure to distribute income), 4943 (relating to taxes on excess business holdings), 4944 (relating to investments whichjeopardize charitable purpose), 4945 (relating to taxes on taxable expenditures), 4951 (relating to taxes on self-dealing), or 4952 (relating to taxes on taxable expenditures), 4955 (relating to taxes on political expenditures), 4958 (relating to private excess benefit), 4971 (relating to excise taxes on failure to meet minimum on prohibited transactions) shall be suspended for any period during funding standard), 4975 (relating to excise taxes which the Secretary has extended the time allowed for making correction under section 4963(e).

(t) Coordination with title 11.-the United the time prescribed by subsection (a) for fiing a petition in the Tax Court with respect to any deficiency shall be suspended for the period during which the debtor is prohibited by reason of such case from fiing a petition in the Tax Court with respect to such deficiency, and for 60 days thereafter.
(1) Suspension of running of period for filing petition in title 11 cases.-- In any case under title 11 of States Code, the running of (2) Certain action not taken into account.-- F or purposes of

the second and third sentences of subsection (a), the fiing

of a proof of claim or request for payment (or the taking of any other action) in a case under title 11 of

the United States

Code shall not be treated as action prohibited by such second sentence.
(g) Definitions.--For purposes of

this section--

(1) Return.--The term "return" includes any return, statement, schedule, or list, and any amendment or supplement
thereto, fied with respect to any tax imposed by subtitle A or B, or chapter 41,42,43, or 44.

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26 USCA § 6213 26 U.S.C.A. § 6213

Page 3

(2) Mathematical or clerical error.-- The term "mathematical or clerical error" means-(A) an error in addition, subtraction, multiplication, or division shown on any return,
(B) an incorrect use of any table provided by the Internal Revenue Service with respect to any return if such incorrect use is apparent from the existence of other information on the return,

(C) an entr on a return of an item which is inconsistent with another entr ofthe same or another item on such return,

(D) an omission of information which is required to be supplied on the return to substantiate an entr on the return,
(E) an entr on a return of a deduction or credit in an amount which exceeds a statutory limit imposed by subtitle A

or B, or chapter 41,42,43, or 44, if such limit is expressed-(i) as a specified monetar amount, or

(ii) as a percentage, ratio, or fraction,

and if the items entering into the application of such limit appear on such return,
(F) an omission of a correct taxpayer identification number required under section 32 (relating to the eared income

credit) to be included on a return,
(G) an entr on a return claiming the credit under section 32 with respect to net earings from self-employment described in section 32( c )(2)(A) to the extent the tax imposed by section 1401 (relating to se1f-emp10ymenttax) on such
net earings has not been paid, and

services necessary for gainful employment)

(H an omission of a correct TIN required under section 21 (relating to expenses for household and dependent care personal exemptions). to allowance of deductions for or section 151 (relating

(h) Cross references.-(1) For assessment as if a mathematical error on the return, in the case of erroneous claims for income tax prepayment 1 (a)(3).

credits, see section 620

(2) For assessments without regard to restrictions imposed by this section in the case of-(A) Recovery of

foreign income taxes, see section 905(c).

(B) Recovery offoreign estate tax, see section 2016.
(3) For provisions relating to application of

this subchapter in the case of certain partership items, etc., see section

6230(a).

~ 2006 Thomson/West. No Claim to Orig. U.S. Govt. Works.

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APPENDIX B

IN THE UNTED STATES COURT OF FEDERAL CLAIMS

No.05-1028 T

(Judge Marian Blan Horn)

ESTATE OF RANK M. SMITH, SR.,
SUNTRUST BANK, T AYLOR W. SMITH, and

RANK M. SMITH, JR., Co-Executors,
Plaintiffs
v.

THE UNITED STATES,

Defendant

DECLARTION OF JENNER DOVER SPRIGGS

I, Jennifer Dover Spriggs, am the attorney of

the Tax Division, United States Department

of Justice, assigned to defend this case, and I state as follows:
1. In my offcial capacity, I have temporar custody of

the Internal Revenue Service

administrative fie with respect to the matters at issue in this case.
2. Attached hereto as the indicated exhibit is a true and correct copy of the following

document which has been made available to me by the Internal Revenue Service:
Exhibit 1 - Certificate of Assessments and Payments for the Estate of

Rankin M.

Smith, Sr.

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I declare under penalty of perjury that the foregoing is true and correct to the best of my
knowledge and belief.

Executed in Washington, D.C., this I qi'ay of July 2006.

J~~t;o~~P~~l~

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United States

of America

. Department of the Treasury Internal Revenue Service
Date: October 13, 2005

CERTIFICATE OF OFFICIAL RECORD

I certify that the annexed: Certificate of Assessments and Payments is an exact transcript of the

account of the tapayer named therein, in respect to the taes specified and for the period specified. All assessments, penalties, interest, abatements, credits, and refuds relating thereto, as disclosed by the
records of this offce as of the date appearng on said certificate are shown therein. I fuer certify that I

have legal custody of certn Federal ta retus, trancripts of accounts, and other accounting "ecords

established and maintained by the Internal Revenue Service pursuant to authority derived under the Internal Revenue Code (United States Code, Title 26), and that the anexed certificate is a true transcript
made from such records; consisting of 5 page(s)

IN WITNESS WHEREOF, I have hereunto set my hand,

and caused the seal of this offce to be affxed, on the day
and year first above written.
he Secretary of the Treasury:

Operations M ger, Accounting Control/Services
Internal Revenue Service

Submission Processing Center
Atlanta Georgia

~ DEFENDANT'S

I ~I~T
Catalog Number 19002E

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CERTIFICATE OF ASSESSMENTS, PAYMENTS, AND OTHER SPECIFIED MATTERS -------------------------------------------------------------------------------RANKIN M SMITH SR ESTATE SUNTRUST BANK ATLANTA EIN/SSN: V

TVPE OF TAX: U.S. ESTATE TAX RETURN

FORM: 706 TAX PERIOD:
DATE

EXPLANATION OF TRANSACTION

OTHER DEB I TS

ASSESSMENT,

-------------------------------------------------------------------------------03-15-1999 9,750,765.42
02-01-1999 RETURN FILED 07506-051-00000-9 199909
07- 29-1998 SUBSEQUENT PAYMENT

(REVERSAL)

CREDIT (REVERSAL)

PA VMENT ,

ASSESSMENT

DATE (23C, RAC 006 )

703,597.00
07-26-1999 07-26-1999

08-31-1998 EXTENSION OF TIME TO FILE

EXT. DATE 01-26-1999
RESTRICTED INTEREST ASSESSED

723,205.42
0.00

199928

ADDITIONAL TAX ASSESSED 07554-583-18001-9 199928
08- 02-1999 SUBSEQUENT PAYMENT

325,443.00
10-25-1999 08-21-2000

07-27-1999 AMENDED RETURN FILED

07506-219-02210-9

ADDITIONAL TAX ASSESSED 07554-677-15101-9 199941
RESTRICTED INTEREST ASSESSED

0.00

813,237.55
PAGE
1

200032

FORM 4340 (REV. 01-2002)

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CERTIFICATE OF ASSESSMENTS, PAYMENTS, AND OTHER SPECIFIED MATTERS - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - -RANKIN M SMITH SR ESTATE SUNTRUST BANK ATLANTA

EIN/SSN:

V

TYPE OF TAX: U. S. ESTATE TAX RETURN

FORM: 706 TAX PER IOD:
DATE

ASSESSMENT PAYMENT, ASSESSMENT, DATE (23C, CREDIT OTHER DEBITS RAC 006 ) (REVERSAL) ( REVERSAi) - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - --

EXPLANATION OF TRANSACTION

ADDITIONAL TAX ASSESSED 07554-615-18000-0 200032
08- 01- 20 0 0 SUBSEQUENT PAYMENT

o .00

08-21-2000

723,206.00

RESTRICTED INTEREST ASSESSED

840,361.74
o .00
840,361. 74

08-13-2001
08-13-2001

200131

ADDITIONAL TAX ASSESSED 07554-601-18001-1 200131
07- 26- 20 01 SUBSEQUENT PAYMENT MISCELLANEOUS PAYMENT

03-01-2002 SUBSEQUENT PAYMENT
RESTRICTED INTEREST ASSESSED

19,290,867.00 07-01-2002 388,153.22
o .00
PAGE

200225

ADDITIONAL TAX ASSESSED 07554-558-18100-2 200225

07-01-2002

FORM 4340 (REV. 01-2002)

2

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CERTIFICATE OF ASSESSMENTS, PAYMENTS, AND OTHER SPECIFIED MATTERS -------------------------------------------------------------------------------RANKIN M SMITH SR ESTATE SUNTRUST BANK ATLANTA
EIN/SSN: V

TYPE OF TAX: U.S. ESTATE TAX RETURN

FORM: 706 TAX PERIOD:
DATE

-------------------------------------------------------------------------------07-01-2002 INTEREST DUE TAXPAYER
07-01-2002 REFUND

EXPLANATION OF TRANSACTION

ASSESSMENT, OTHER DEBITS (REVERSAL)

PAYMENT,

(REVERSAi)

CREDIT

ASSESSMENT

DATE (23C, RAC 006 )

175,620.82

(9,543,372.21)
0.00
07-22-2002

ADDITIONAL TAX ASSESSED BY EXAMINATION AUDIT DEFICIENCY PER DEFAUL T OF 90 DAY LETTER 17547-584-00116-2 200228
QUICK ASSESSMENT

49551-171-13000-2
07-01-2002 INTEREST DUE TAXPAYER
REVERSED

13,644,400.00

06-20-2002

(175,620.82)

07-01-2002 CANCELED REFUND CHECK
09-20-2002 INSTALLMENT/MANUAL BILLING
05-19- 20 0 3 ASSESSMENT STATUTE EXP IR DATE EXTEND TO 07-01-2002

9,543,372.21

ADDITIONAL TAX ASSESSED BY EXAMINATION AUDIT, CLOSED TO APPEALS PRIOR TO 90 DAY LETTER 17547-610-10001-3 200332

o .00

08-18-2003

FORM 4340 (REV. 01-2002)

PAGE

3

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CERTIF ICATE OF ASSESSMENTS, PAYMENTS, AND OTHER SPECIF lED MATTERS --------------------------------------------------------------------------------

RANKIN M SMITH SR ESTATE SUNTRUST BANK ATLANTA

EIN/SSN:

V

TYPE OF TAX: U.S. ESTATE TAX RETURN

FORM: 706 TAX PERIOD:
DATE

-------------------------------------------------------------------------------ADDITIONAL TAX ASSESSED BY EXAMINATION AUDIT REVIEW 49547-482-70000-5 200513
04- 1 1 - 20 05 RENUMBERED RETURN

EXPLANATION OF TRANSACTION

ASSESSMENT, OTHER DEBITS (REVERSAL)

CREDIT (REVERSAL)

PAYMENT,

ASSESSMENT

DATE (23C, RAC 006 )

o . 00

04-11-2005

49547-482-70000 - 5
BILLING DEFAULT

07-27-2005

INSTALLMENT/MANUAL

06-20-2002 08-26-2002 07-27-2005 09-26-2005

Statutory Not i ce of Balance Due Statutory Notice of Intent to Levy Statutory Notice of Balance Due Statutory Notice of Intent to Levy
PAGE

FORM 4340 (REV. 01-2002)

4

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CERTIF ICATE OF ASSESSMENTS, PAYMENTS, AND OTHER SPECIF lED MATTERS --------------------------------------------------------------------------------

RANKIN M SMITH SR ESTATE SUNTRUST BANK ATLANTA

EIN/SSN:

V

FORM: 706 TAX PERIOD:
BALANCE

TYPE OF TAX: U.S. ESTATE TAX RETURN

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - --

I CERTIFY THAT THE FOREGOING TRANSCRIPT OF THE TAXPAYER NAMED ABOVE IN RESPECT TO THE TAXES SPECIFIED IS A TRUE AND COMPLETE TRANSCRIPT FOR THE PERIOD STATED, AND ALL ASSESSMENTS, ABATEMENTS, CREDITS, REFUNDS, AND ADVANCE OR UNIDENTIFIED PAYMENTS, AND THE ASSESSED BALANCE RELATING THERETO, AS DISCLOSED BY THE RECORDS OF THIS OFFICE AS OF THE ACCOUNT STATUS DATE ARE SHOWN THEREIN. I FURTHER CERTIFY THAT THE OTHER SPECIFIED MATTERS SET FORTH IN THIS TRANSCRIPT APPEAR IN THE OFF ICIAL RECORDS OF THE INTERNAL REVENUE SERVICE.

--------------------------------------------------------------------------------

4,276,648.61

:: ::: :::: -:: - - -::: :~~~~ ~~~~~ ~~ - - - - - - - - - - - - - - - - - - - -PR INT NAME

TITLE:

tions Maer, Accounti ContrVServces
198

DELEGATION ORDER:

LOCATION: INTERNAL REVENUE SERVICE DORAVILLE, GA

ACCOUNT STATUS DATE 10/12/2005

FORM 4340 (REV. 01-2002)

PAGE

5

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