- 28 -
b. Petitioner Paul S. Mahoney
Dr. Mahoney resided in Los Angeles, California, at the time
he filed his petition in the instant cases. During 1981, he
worked as a physician. Dr. Mahoney reported adjusted gross
income of $175,155 on his 1981 Federal income tax return.
On December 11, 1981, Dr. Mahoney subscribed to one
partnership unit in JDP for a price of $50,000. As a result of
his capital contribution to JDP, Dr. Mahoney acquired an 11.1-
percent capital interest in JDP. Also on December 11, 1981, he
executed the signature page to the certificate and agreement of
limited partnership and certificate of fictitious name, offeree
questionnaire, and a promissory note in the amount of $35,000
payable to JDP in installments of $15,000 on or before May 1,
1982, $10,000 on or before May 1, 1983, and $10,000 on or before
May 1, 1984, together with interest of 10 percent per year of the
unpaid balance. Dr. Mahoney paid to JDP or its escrow agent
$15,000 on December 15, 1981, $16,160 on April 18, 1982, $12,000
on April 18, 1983, and $11,000 on May 1, 1984.
On his 1981 Federal income tax return, Dr. Mahoney claimed a
net loss relating to JDP of $40,529. By notice of deficiency
dated June 21, 1989, respondent disallowed the partnership loss
relating to JDP that Dr. Mahoney had claimed for 1981 on the
grounds that he had not established:
any amount was paid pursuant to a research and
development agreement or, if paid, that such
expenditures were not preconceived shams lacking
economic substance.
Page: Previous 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 NextLast modified: May 25, 2011