dissenting: The circumstances of this case include the fact that a very large amount of cash was possessed by Peoples Loan and Mr. Hendrickson, and they claimed not to be the owners of the cash. According to them, the cash belonged to the Indiana estate of Mr. Martin. However, although the estate asserted a possessory right to the cash, it did not and could not claim to be the owner. Another estate disputed its possessory right, and many alleged investors in Mr. Martin’s plans claimed to be the true owners of the cash. In my view, these circumstances constitute a case for which section 6867 was designed, and I find the interpretation of section 6867 adopted by the majority to be inconsistent with the objective of that section. Therefore, I must dissent.
Congress considered the jeopardy assessment procedures not well suited to situations in which the Commissioner has reason to believe that a tax is owing with respect to property but cannot determine the owner of such property. In such cases, the Commissioner is unable to associate such property with any particular. person and therefore cannot determine the existence or amount of deficiency for an identifiable person. H. Rept. 97-760 (Conf.) (1982), 1982-2 C.B. 600, 654. To alleviate this problem of the Commissioner, section 6867 was enacted. Tax Equity and Fiscal Responsibility Act of 1982, Pub. L. 97-248, sec. 330, 96 Stat. 619.
The petitioners argue that section 6867 does not require them to establish the identity of the true owner of the cash. They contend that they can remove themselves from the scope of section 6867 merely by claiming that the cash belongs to another person whose identity can be readily ascertained by the Commissioner and by showing that such person acknowledges ownership of such cash. Thus, they claim that the cash “belongs” to the estate and that Peoples Loan, as administrator of the estate, acknowledges ownership of such cash. However, under my view of section 6867, it supplements the jeopardy assessment provisions of sections 6851 and 6861 by authorizing the Commissioner to make a jeopardy assessment when he finds an individual in possession of a substantial amount of cash, when that individual denies ownership of the cash, and when the true owner is not readily identifiable. Merely authorizing the Commissioner to make a jeopardy assessment under such circumstances would not alleviate his problem, for he must also compute a deficiency. To solve that aspect of the problem, section 6867 also creates a presumption as to the deficiency owed by the owner of the cash: it presumes that 50 percent of the cash is a deficiency. Thus, section 6867 accomplishes two objectives: when the owner of cash is unknown, it authorizes a jeopardy assessment, and it creates a special deficiency.
Section 7429 gives the District Courts the authority and the responsibility for reviewing a jeopardy assessment to determine whether the assessment is proper, and this Court has no authority to review the assessment. However, we do have the authority and responsibility to review the deficiency determined by the Commissioner. Since the deficiency rests on the applicability of section 6867, we must review the evidence to decide whether that section is applicable. Consequently, we must decide whether the individual possessing the cash claims that it belongs to another person whose identity the Commissioner can readily ascertain and who acknowledges ownership of such cash.
In my view, section 6867 requires that the petitioners do more than merely claim that the cash belongs to someone else. I believe that they must identify the true owner of such cash before being relieved of a deficiency under section 6867. See Matut v. Commissioner, 86 T.C. 686, 691 (1986). Section 6867 was developed to permit the Commissioner to collect income taxes presumed to be owed by an unidentified owner of cash (H. Rept. 97-760, supra, 1982-2 C.B. at 654), and such purpose would be frustrated by allowing the petitioners to avoid its provisions merely by claiming that the cash in question belonged to another and that such person acknowledged ownership of such cash.
Moreover, section 6867 is applicable unless the true owner is “readily identifiable”; it is not enough that the true owner can be identified — his identity must be “readily” ascertainable by the Commissioner. In this case, there is a host of controversy over the ownership of the cash. Peoples Loan claims that as administrator of Mr. Martin’s estate in Indiana, it owns the cash. However, the Exchange National Bank has disputed the claim of Peoples Loan. The Exchange National Bank claims to be acting under authority of a Colorado court and claims to be the owner of the cash. Furthermore, more than 400 persons have filed claims against the estate on the grounds that they invested funds in NCEA, that Mr. Martin and NCEA held the funds as their agent, and that they are the owners of the cash; and the total of their claims exceeds the amount of the cash held by Peoples Loan and Mr. Hendrickson.
Under these circumstances, it is clear that the Commissioner cannot readily ascertain the owner of the cash. If the cash were transferred to Peoples Loan, and if the Commissioner made an assessment against it as administrator, he would encounter the risk that the Exchange National Bank or the alleged investors in NCEA would claim that the cash belonged to them and was not to be used to pay any deficiency claimed against Mr. Martin or his estate. The Commissioner does not know against whom to make a jeopardy assessment or to whom to issue a notice of deficiency. He cannot ascertain the true owner of the cash until the completion of protracted litigation, and Congress provided that the procedures of section 6867 are to apply when the true owner is not readily identifiable. Consequently, I believe that these facts constitute a case in which section 6867 should be applied.
SWIFT and Gerber, JJ., agree with this dissent.