-53-
Petitioner and Mr. Illingworth
Both petitioner and Mr. Illingworth testified that they did not
discuss the tax ramifications of creating and operating Tandrill.
Under the circumstances herein, we are not required to, and we do
not, accept the self-serving testimonial evidence presented by
petitioners to sustain their burden of establishing error in
respondent’s determination.44 See Geiger v. Commissioner, 440 F.2d
688, 689-690 (9th Cir. 1971), affg. per curiam T.C. Memo. 1969-159.
Based upon the entire record, we conclude that petitioner
became a partner in Tandrill in order to reap tax benefits; i.e.,
to offset the $3,492,989 gain he realized in 1976 from the sale of
his Hy-Gain stock with losses from Tandrill. The record makes it
clear that petitioner, Mr. Illingworth, and Tandrill all had the
same primary objective: to create tax losses. The absence of a
primary for-profit objective is “so obvious that it must be the same
for all of the individual partners or their [partnership].” Donahue
v. Commissioner, T.C. Memo. 1991-181, affd. without published
opinion 959 F.2d 234 (6th Cir. 1992). Thus, it makes no practical
difference whether the relevant motive belongs to petitioner, Mr.
Illingworth, or Tandrill itself.
Petitioner willingly accepted the Partnership and Management
Agreements. He contributed $300,000 for a 93.75-percent interest;
Mr. Illingworth contributed $20,000 for a 6.25-percent interest.
44 Petitioner’s testimony was marked by frequent failures
of recall, and he failed to provide answers to simple questions.
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