- 58 -- 58 -
Circuit reversed our imposition of the negligence additions to
tax. Petitioners point out that the taxpayer in that case relied
in part upon a tax opinion contained in the offering materials.
In the present cases, however, petitioners have not shown
that they placed substantial reliance upon the tax opinion letter
attached to the offering memoranda. Moreover, the offering
memoranda for the Partnerships herein warned prospective
investors that the accompanying tax opinion letters were not in
final form, and were prepared for the general partner, and that
prospective investors should consult their own professional
advisers with respect to the tax benefits and tax risks
associated with the Partnerships. The tax opinion letters
accompanying the SAB Recovery, SAB Recycling, and SAB Reclamation
offering memoranda were addressed solely to the general partner
and began with the following opening disclaimer:
This opinion is provided to you for your individual
guidance. We expect that prospective investors will
rely upon their own professional advisors with respect
to all tax issues arising in connection with an
investment in the Partnership and the operations
thereof. We recognize that you intend to include this
letter with your offering materials and we have
consented to that with the understanding that the
purpose in distributing it is to assist your offerees'
and their tax advisors in making their own analysis and
12(...continued)
agreed to be bound by the Court's opinion regarding the
application of the additions to tax under sec. 6653(a), inter
alia. Accordingly, although the Court's analysis focused on one
taxpayer, the additions to tax were sustained with respect to all
of the taxpayers.
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