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Respondent assessed the 1975-77 deficiencies in income tax.
The 1975-77 deficiencies remained unpaid until 1987, when
petitioner paid them with the proceeds of the home equity loan.
Gerald paid no portion of the 1975-77 deficiencies.
During the years in issue, Gerald invested in five tax
shelters that Steven Gurian (Gurian), Gerald's financial adviser,
had recommended to him. Ajac also invested in the tax shelters
Gurian recommended. Gerald reinvested the tax savings derived
from the 1978, 1979, and 1980 tax shelter investments in his
businesses.
Petitioner had met Gurian once, at a social event, and she
knew that Gurian was a financial adviser. Petitioner did not
know that Gurian sold tax shelters, and she never discussed
business or financial matters with Gurian.
Gerald discussed each tax shelter investment with Gelda.
Gelda reviewed the tax shelters and concluded that the shelters
were solely tax motivated with no opportunity for economic gain,
and he advised Gerald not to invest in the tax shelters. Gelda
came to a definitive conclusion that each of the tax shelters was
solely tax motivated.
Gelda never discussed the tax shelters or Gerald's
businesses with petitioner. Gelda believed that petitioner had
no knowledge of the tax shelter investments.
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