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$47,953. The Schedules K-1 filed with the partnership's Form
1065 for 1989 revealed that the Hamada corporation and the Curtis
corporation were equal partners and that each was allocated 50
percent, or $23,977, of the loss claimed by the Curtis-Hamada
partnership.
In or about August 1991, the Curtis-Hamada partnership filed
an amended Form 1065 for 1989 (the amended Form 1065), along with
amended Schedules K-1 (the amended Schedules K-1) for 1989. On
the amended Form 1065, petitioners increased the $47,953 ordinary
loss by $5,829 (i.e. to $53,782). Additionally, the amended Form
1065 identified W. Robert Curtis as the tax matters partner. The
amended Schedules K-1 identified Edwin C. Hamada, W. Robert
Curtis, and Cheryl L. Riess-Curtis as equal individual
shareholders in the Curtis-Hamada partnership and allocated each
partner 33-1/3 percent of the profits and losses of the Curtis-
Hamada partnership.2
Petitioners filed their Federal individual income tax return
(Form 1040) for 1989 in or about August 1991. On their Form
1040, petitioners reported a loss in the amount of $35,854 (i.e.,
2/3 of $53,782) reflecting petitioners' distributive share of the
loss claimed by the Curtis-Hamada partnership on its amended Form
2 Petitioners concede that the Hamada corporation and the
Curtis corporation were partners in the Curtis-Hamada partnership
and that such partnership is a TEFRA partnership. However,
petitioners contend that 66-2/3 percent and 33-1/3 percent of the
distributive share of the profits and losses should be allocated
to the Curtis corporation and the Hamada corporation,
respectively.
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