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These cases concern real estate investments of R. James
Nicholson (Mr. Nicholson), Philip D. Winn (Mr. Winn), and David
A. Gitlitz (Mr. Gitlitz), and several related entities, during
the late 1980's. Empire Savings, Building & Loan Association
(Empire), a Colorado savings and loan association, participated
directly as the lender of funds to purchase the realty and
indirectly through its wholly owned subsidiary, E.S.L. Corp.
(ESL), as an investor in the investing entities.4
Parker Properties and Twenty Mile are partnerships formed,
at Empire’s suggestion, for the purposes of acquiring,
developing, and selling the real estate under consideration.
Both entities were accrual method taxpayers during the relevant
years.
3(...continued)
a notice partner of Parker Properties Joint Venture (Parker
Properties) for the year at issue, was filed in docket No. 18386-
92. Sec. 6226(b)(1). The tax matters partner of Parker
Properties, Nicholson Enterprises, Inc. (Nicholson Enterprises),
did not cause a petition for readjustment of partnership items to
be filed within the period specified by sec. 6226(a). However,
Nicholson Enterprises timely elected to intervene in docket No.
18386-92 in accordance with sec. 6226(b) and Rule 245(a). PND,
Ltd. (PND), is both the notice partner and tax matters partner of
Twenty Mile Joint Venture (Twenty Mile) for the year at issue,
and its petition was filed in docket No. 18387-92.
4 Empire's equity investment was made based on the
understanding that it was permitted by thrift industry
regulations. It was also understood that industry regulations
required that this type of investment be made through a
subsidiary.
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