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credits in the amount of $20,928.10 For Fredericks' gross
$50,000 investment in SAB Recycling, he and his wife Stephanie
claimed an operating loss in the amount of $39,741 and investment
tax and business energy credits in the amount of $82,638 on their
1982 return. As a result of Fishbach's one-third interest in
ZFH, and ZFH's gross $50,000 investment in SAB Recovery in 1981
and gross $25,000 investment in SAB Recycling in 1982, on their
1982 return Fishbach and his wife Patricia claimed an operating
loss in the amount of $7,230 and investment tax and business
energy credits in the amount of $13,743.
The direct reductions in petitioners' Federal income tax, as
a result of the investment tax credits alone, ranged from 165
percent to 167 percent of their cash investments, not taking into
consideration any rebated commissions or advance royalty
payments.11 Therefore, after adjustments of withholding,
estimated tax, or final payment, like the taxpayers in Provizer
v. Commissioner, T.C. Memo. 1992-177, "except for a few weeks at
10 The Gollins claimed $6,391 of the regular investment credit
on their 1982 return and carried back the remainder, $4,073, to
1979 (an additional $896 in regular investment credits was
claimed on their amended 1979 return). With respect to the
business energy credits, the Gollins carried back $6,919 to 1979
and $3,545 to 1980.
11 Although the record in docket No. 19612-90 does not disclose
the amounts of Fishbach's second-tier interests, the projected
investment tax and business energy credits for SAB Recovery and
SAB Recycling for the first year of the investment, $82,639, is
165 percent of the corresponding projected investment amount,
$50,000.
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