- 9 - shareholder in F & G. Grant and Roberts have been general partners together in other investments. The Hyannis offering memorandum disclosed that Roberts and Grant could each be deemed promoters of Hyannis and that Miller represented Grant. Roberts mailed petitioner a copy of the Hyannis offering memorandum. Petitioner reviewed the offering memorandum and directed his questions to Roberts. Based on the information provided by these sources, and his personal judgment, petitioner invested in Hyannis. Petitioners do not have any education or work experience in plastics recycling or plastics materials. Petitioner did not investigate PI. Petitioners did not see a Sentinel recycler before investing in Hyannis. OPINION In Provizer v. Commissioner, T.C. Memo. 1992-177, a test case involving the Clearwater transaction and another tier partnership, this Court (1) found that each Sentinel EPE recycler had a fair market value not in excess of $50,000, (2) held that the Clearwater transaction was a sham because it lacked economic substance and a business purpose, (3) upheld the section 6659 addition to tax for valuation overstatement since the underpayment of taxes was directly related to the overstatement of the value of the Sentinel EPE recyclers, and (4) held that losses and credits claimed with respect to Clearwater were attributable to tax-motivated transactions within the meaning of section 6621(c). In reaching the conclusion that the ClearwaterPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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