                        T.C. Memo. 1996-213



                      UNITED STATES TAX COURT



                  RICHARD R. REED, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No.   18466-94.                     Filed May 1, 1996.



          Held: With respect to P's 1990 taxable year, the
     Court will enter a decision in accordance with R's
     computation.



     Richard R. Reed, pro se.

     Paul K. Voelker, for respondent.


                        MEMORANDUM OPINION


     LARO, Judge:   Respondent moves the Court for entry of

decision with respect to petitioner’s 1990 and 1991 taxable

years.   Petitioner objects thereto with respect to his 1990 year.
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We must decide whether the subject decision should reflect

$25,605 in income for 1990, from the discharge of indebtedness.

We hold it should.

                             Background1

     This case was calendared for trial on February 5, 1996.

Following a conference with the Court on that date, respondent’s

counsel (Paul K. Voelker) announced that the parties had reached

a basis of settlement which he would read into the record.     The

Court instructed petitioner to “listen very carefully because

when Mr. Voelker is done reading then I’m going to turn to you

and say, are you in agreement.”

     Mr. Voelker read the parties’ settlement into the record on

an issue by issue basis.   One of the issues concerned income from

discharge of indebtedness.   Mr. Voelker stated that the parties

had agreed that there would be no change to the amount of

discharge of indebtedness income that appeared in the notice of

deficiency for 1990.   The Court asked petitioner if he agreed

with Mr. Voelker’s reading of the settlement.   Petitioner

replied:   “Yes sir, I’m in full agreement.”    The Court ordered

the parties to file decision documents with the Court.




     1
       Petitioner resided in Las Vegas, Nevada, when he
petitioned the Court.
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       Respondent has prepared decision documents,2 but petitioner

refuses to sign them because, he alleges, he did not realize

$25,605 of discharge of indebtedness income during 1990.

Respondent determined that petitioner realized this income in

1990, and she included this determination in the subject notice

of deficiency.

                                Discussion

       Petitioner alleges that he is not liable for tax on the

discharge of indebtedness income determined by respondent because

the indebted property was involuntarily taken from him by

foreclosure.       We need not and do not consider petitioner’s

allegation concerning his surrender of the indebted property.

Whether the property was involuntarily taken from him by

foreclosure, which petitioner states would not result in taxable

income, is of no importance to the decision that we must enter

herein.       What is important is that petitioner and respondent

agreed to settle their case on the terms and conditions

memorialized in the record.       The parties’ agreement is a

contract, governed and enforced by general principles of contract

law.       Like contracts, stipulations of settlement bind the parties

thereto to the terms thereof.       Stamos v. Commissioner, 87 T.C.


       2
       The decision documents reflect the fact that respondent
conceded approximately 53 percent and approximately 47 percent of
the deficiencies that she determined for petitioner’s 1990 and
1991 taxable years, respectively.
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1451, 1455 (1986); see also Jeff D. v. Andrus, 899 F.2d 753,

759 (9th Cir. 1989).

     We will enforce a stipulation of settlement, whether filed

or orally stipulated into the record, unless justice requires

that we do otherwise.   Adams v. Commissioner, 85 T.C. 359,

375 (1985); Sennett v. Commissioner, 69 T.C. 694 (1978);

Saigh v. Commissioner, 26 T.C. 171, 177 (1956).       In the instant

case, justice does not require that we do otherwise.       The record

speaks for itself and shows that the parties agreed to resolve

this case in the manner set forth therein.       The stipulation of

settlement memorialized in the record, voluntarily entered in

settlement of this lawsuit, must be given binding effect.       The

parties struck a bargain in the stipulation, and petitioner must

live with the benefits and burdens of it.

     To reflect the foregoing,

                                         An appropriate order will be

                                 issued granting respondent's motion

                                 for entry of decision, and decision

                                 will be entered in accordance

                                 with the respondent’s computation.
