-58- 552, 555-557 (1985), affd. without published opinion 795 F.2d 1005 (2d Cir. 1986). An underpayment is substantial if it exceeds $1,000. Sec. 6621(c)(2). The phrase “tax-motivated transactions” includes straddles and transactions lacking a profit motive. See Ewing v. Commissioner, 91 T.C. at 422-423. We have concluded that petitioner and Mr. Illingworth formed Tandrill for the purpose of generating tax benefits. Moreover, the $1,000 statutory threshold is surpassed in this case for both taxable years in issue. Consequently, petitioners’ underpayments based on the losses attributable to tax-motivated transactions are subject to the additional interest provided by section 6621(c). We hold that petitioners are liable for the increased rate of interest under section 6621(c) on the entire underpayments for 1976 and 1980. To reflect the foregoing, Decision will be entered under Rule 155.Page: Previous 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 Next
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