                        T.C. Memo. 2004-10



                      UNITED STATES TAX COURT



          ROBERT K. AND DAWN E. LOWRY, Petitioners v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent*



     Docket No.   11579-00.          Filed January 12, 2004.



          On a Motion for Reconsideration of Findings or
     Opinion and a Motion to Vacate or Revise a Decision,
     under, respectively, Rules 161 and 162, Tax Court Rules
     of Practice and Procedure, Ps challenge the Court’s
     factual and legal conclusions in Lowry v. Commissioner,
     T.C. Memo. 2003-225. There, this Court decided that a
     conceded gain under sec. 1231, I.R.C., was realized in
     1994, and not in 1993, as contended by Ps.

          Held: Ps have failed to point to any substantial
     errors of fact or law or to present any newly
     discovered evidence that could not have been introduced
     previously even if Ps had exercised due diligence.
     Estate of Quick v. Commissioner, 110 T.C. 440 (1998),
     applied. Ps’ Motions will be denied.




     *
      This opinion supplements our previously filed Memorandum
Opinion in Lowry v. Commissioner, T.C. Memo. 2003-225.
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     Daniel C. Ertel, for petitioners.

     Lydia A. Branche, for respondent.



                 SUPPLEMENTAL MEMORANDUM OPINION


     NIMS, Judge:   This case remains before the Court on

petitioners’ Motion for Reconsideration of Findings or Opinion

under Rule 161, and Motion to Vacate or Revise Decision under

Rule 162 (collectively, the Motions).    Since the Motions are

interconnected we deal with them together.    The Motions relate to

our Memorandum Opinion, Lowry v. Commissioner, T.C. Memo. 2003-

225, filed July 30, 2003, which we incorporate herein, and the

Decision entered thereunder.

     Unless otherwise indicated, all section references are to

sections of the Internal Revenue Code in effect at all relevant

times hereunder, and all Rule references are to those contained

in Tax Court Rules of Practice and Procedure.

     In Lowry v. Commissioner, supra, we held, on the issue now

again challenged by petitioners, that petitioners realized a

section 1231 gain in 1994 rather than in 1993, as they contended.

     Rules 161 and 162 provide for Motions for Reconsideration of

Findings or Opinion and for Motions to Vacate or Revise a

Decision, respectively.   Reconsideration allows the Court to
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correct substantial errors of fact or law, or to allow newly

discovered evidence to be introduced that could not have been

introduced before the filing of an opinion even if the moving

party had exercised due diligence.     Estate of Quick v.

Commissioner, 110 T.C. 440 (1998); Estate of Halder v.

Commissioner, T.C. Memo. 2003-284.     The granting of a motion for

reconsideration rests within the discretion of the Court, and

petitioners must show unusual circumstances or substantial error

for their motion to be granted.   Estate of Quick v. Commissioner,

supra, at 441.   Moreover, we have held that reconsideration is

not the appropriate vehicle for rehashing previously rejected

legal arguments or tendering new legal theories to reach the end

result desired by the moving party.     Id. at 441-442.

     Petitioners allege that the factual conclusions reached by

the Court in its Memorandum Opinion are incomplete, incorrect,

and not supported by the evidence.     We disagree.   Furthermore,

all but one of the legal issues raised in the Motions have been

raised by petitioners in their original and reply briefs.

     Petitioners assert for the first time that section 6201(d)

places the burden on respondent for producing reasonable and

probative information concerning respondent’s assertion of the

incorrectness of the Form 1099-A, Acquisition or Abandonment of
                                - 4 -

Secured Property, in which AAL reported that it had acquired the

Fitch Property on December 15, 1993.    On motions for

reconsideration we do not, except under extraordinary

circumstances, address any new issue which a party could have

addressed but failed to address prior to the Court’s deciding the

case.   See, e.g., Stoody v. Commissioner, 67 T.C. 643, 644

(1977).   But in any case, the facts in evidence in this case

abundantly demonstrate, as we found, that the Form 1099-A was

erroneous.   Furthermore, as we also pointed out in our Memorandum

Opinion, the amended 1994 partnership return emphasized the

partners’ position that the Form 1099-A was erroneous.

     Petitioners contend that the factual statement in our

Memorandum Opinion is erroneous in its basic elements.

Essentially, petitioners disagree with the Court’s conclusions

about the facts.   In our Memorandum Opinion, we considered and

addressed petitioners’ arguments and all of the documentary

evidence.    Petitioners have not shown any manifest error of fact.

     On the basis of the record, petitioners’ version of the

“facts” misconstrues the real facts.    In essence, in addition to

the “incorrect” Form 1099-A, petitioners’ case is anchored on two

essential documents; namely, the Grant Deed, which was dated

December 15, 1993, and the Covenant Not to Sue, which was also
                               - 5 -

dated December 15, 1993.   Petitioners believe that the December

15, 1993, date on these documents establishes that the

forgiveness of indebtedness income was realized in 1993, not

1994.

     However, petitioners have declined to address, or have

misconstrued, the most salient fact; namely, that the escrow

instructions, dated December 9, 1993, were issued to the Title

Company on behalf of both AAL, the creditor, and the debtor

Partnership.   The escrow instructions are worded in such a way

that the Title Company’s “acceptance” of the instructions would

be completed only when various exceptions to closing title had

been satisfied.   These, in fact, were not completed until May 27,

1994, when title closed with the filing for recordation of the

aforementioned Grant Deed and the issuance of an owner’s title

policy, the exceptions having been satisfied.   It was on this

date that 1994, and not 1993, was established as the year in

which the forgiveness of indebtedness income was realized.

     Petitioners dispute the Court’s holding that the facts do

not bring this case within those of Keith v. Commissioner, 115

T.C. 605 (2000), which case specifically involved a type of

transaction under Georgia law known as a “contract for deed.”     As

we pointed out in the Memorandum Opinion, Georgia law normally

construes a contract for deed as a device for passing equitable

ownership, leaving the seller with bare legal title and
                               - 6 -

essentially a security interest until all installment payments

have been made.   The case before us does not involve a contract

for deed, and petitioners have offered nothing new to support

their continued argument on this point.

     For the foregoing reasons, we will deny petitioners’

Motions.


                               An appropriate Order will

                          be issued.
