Marvin W. and Kathryn A. McPike - Page 18

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               As previously discussed, petitioners' efforts to assess                
          their proper income tax liability consisted of their reliance               
          upon the promotional materials and their discussions with                   
          Lukensow.  It is clear that they did not make the kind of factual           
          or legal analysis of the GD&L container leasing program that                
          would enable them to formulate any reasonable belief one way or             
          another as to whether the tax treatment they gave to their                  
          claimed deductions and ITC was more likely than not the proper              
          treatment.  Having concluded that petitioners' reliance on                  
          Lukensow and the promotional materials was neither reasonable nor           
          in good faith, it follows that no reduction of the understatement           
          is available and that respondent did not abuse her discretion in            
          declining to waive the addition to tax under section 6661(a).               
          Accordingly, respondent's determination with respect to this                
          issue is sustained.                                                         
          Section 6621(c) Increased Rate of Interest                                  
               Section 6621(c) provides for an increased interest rate with           
          respect to any "substantial underpayment" (greater than $1,000)             
          in any taxable year "attributable to 1 or more tax motivated                
          transactions".  The increased rate of interest applies as of                
          December 31, 1984, even though the transaction was entered into             
          prior to the enactment of the statute.  Solowiejczyk v.                     
          Commissioner, 85 T.C. 552 (1985), affd. without published opinion           
          795 F.2d 1005 (2d Cir. 1986).  The term "tax motivated                      
          transaction" includes any "sham or fraudulent transaction".  Sec.           




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