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represented Mr. Mussman and NITCO during the examinations that
led to the IRS’ issuances of the notices of deficiency in the
instant cases. MW&E attorneys also represented NITCO in the
formation of the limited partnership.
Pursuant to their partnership agreement, the partners valued
their respective capital contributions to the BMCT limited
partnership as follows:
General Partner Description Value
BMCT All assets subject to all $-0-
liabilities
FiberComm All assets subject to all 6,507,353
liabilities
Limited Partner Description Value
NITCO Subordinated promissory note $3,972,553
dated Apr. 22, 1991, from
BMCT, in the principal amount
of $3,615,771, together with
interest accrued thereon of
$210,920 and the contribution
of equipment worth $145,862
On the BMCT limited partnership's December 31, 1991,
financial statements, the partners' formation of the partnership
was not treated as being an arm's-length transaction among the
partners. Certain notes to the BMCT limited partnership's
December 31, 1991, financial statements concerning the relative
capital contributions made by BMCT, FiberComm, and NITCO,
explained, in pertinent part:
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