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Gelda prepared the 1979 Form 1040, signed it, and forwarded
it to Gerald to sign and file. Gerald gave the 1979 Form 1040 to
petitioner to sign, and he assured her that it had been prepared
properly. Petitioner noticed that Gelda had signed the 1979 Form
1040, and she believed that Gelda had prepared it properly.
Before signing the 1979 Form 1040, petitioner reviewed it as best
she could.
Gelda prepared the 1980 Form 1040, signed it, and forwarded
it to Gerald to sign and file. Gerald signed petitioner's name
on the 1980 Form 1040, and petitioner never reviewed it.
Petitioner did not know that Gerald had placed her signature on
the 1980 Form 1040, and Gerald never discussed with petitioner
his having signed her name.
Tax Shelter Investments
Gerald invested in tax shelters as early as 1975. As a
result of Gerald's tax shelter investments, respondent determined
tax deficiencies against the Jacobys for the taxable years 1975,
1976, and 1977 (the 1975-77 deficiencies) in the amounts of
$26,334.39, $62,354.56, and $76,863.49, respectively. None of
these deficiencies is at issue in this case.
The 1975-77 deficiencies were attributable to Gerald's
investments in Hawk Mining Co., Ltd. (Hawk Mining), Mason Coal
Program (Mason Coal), and T.A.B. Production Co. (T.A.B.
Production). Gerald reinvested the tax savings derived from the
1975, 1976, and 1977 tax shelter investments in his businesses.
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