G. Dastgir and Mary A. Qureshi - Page 14

               Petitioner contends that he did everything he could “to                
          guarantee this was [a] legitimate investment.”  Although petitioner         
          did request a law firm to review literature from FoodSource, he did         
          nothing else. He did not seek any independent verification of the           
          information FoodSource provided.  He did not inquire as to the              
          actual cost of manufacturing the container, nor did he attempt to           
          evaluate the container’s fair market value.  Based on the record            
          before us, we are not persuaded that petitioner had an actual and           
          honest profit objective with respect to his involvement in the              
          FoodSource program.  See Sutton v. Commissioner, 84 T.C. 210, 222-          
          226 (1985), affd. per curiam 788 F.2d 695 (11th Cir. 1986)                  
               We do not believe that petitioner invested $26,000, in a year          
          when petitioners’ income was approximately $35,000, for the purpose         
          of generating an unknown and unsubstantiated amount of future               
          income.  Clearly, of considerable if not primary importance to              
          petitioner in his participation in the FoodSource program was the           
          immediate tax advantages he could achieve and the refunds that              
          could be (and were) claimed on petitioners’ amended returns for             
          prior years.                                                                
               Petitioner had no background or experience in the                      
          transportation of produce, nor did he exhibit any desire to become          
          involved with it.  He did not follow up on his investment to                
          determine whether the container was completed or placed in an               
          income-producing use.  He never had control over the container.             

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