DISTRICT COURT SUSTAINS FPAA AFTER STIPULATION BETWEEN GOVERNMENT AND KPMG-RELATED PLAINTIFF.

At issue in this TEFRA partnership proceeding, brought pursuant to 26 U.S. § 6226, are the adjustments to the partnership returns of AWS Management, LLC, and AWS Acquisitions, LLC, for the 2000 taxable year, as determined by the Internal Revenue Service and set forth in the Notices of Final Partnership Administrative Adjustments issued to the partnerships and partners. An outright dismissal of this action by the Court is not a viable resolution of this proceeding since 26 U.S.C. § 6226(h) provides that a dismissal of the action "shall be considered as its decision that . . . [the FPAAs] is [are] correct." To reflect the fact that the settlement reached here is the result of compromises made by all parties, the parties here hereby stipulate and agree to the entry of the following proposed judgment:

February 16, 2011

"The adjustments set forth in the Notices of Final Partnership Administrative Adjustment issued on October 15, 2004, with respect tax returns filed by AWS Management, LLC, and AWS Acquisitions, LLC, for the taxable year ending December 31, 2000, are sustained except as modified by agreement between the guardian ad litem, Stephen B. Petty, for the filing partner, Mary Chandler Petty, and the United States, by and through the Tax Division, Department of Justice."

DATE: March 7, 2011