- 5 - of a master recording or the likelihood of success of a recording artist. In November 1982, Cunningham provided petitioner with a promotional booklet entitled "Southampton Music Company: 1982- 1983 Program". The promotional booklet emphasizes the tax benefits of investing in a master recording rather than any economic benefits that could be expected. The booklet includes a 36-page tax opinion by Joseph Wetzel, an attorney in Portland, Oregon. The tax opinion discusses the tax benefits of the investment and potential tax problems that could be raised by the Internal Revenue Service and ways to avoid them. The promotional booklet also contains a chart entitled "Table of Advance Lease Payments and First Year Tax Benefits" with four levels of escalating investments with escalating tax benefits. For example, according to the chart, a cash investment of $31,000 in a master recording valued at $400,000 would yield in the first year an investment tax credit of $40,000 and a tax deduction of $26,000. Petitioner asked William Parnell, an acquaintance who was a return preparer and an enrolled agent before the Internal Revenue Service, to review the Southampton promotional booklet. According to petitioner,2 Parnell's assessment of the 2 Parnell did not testify in this case.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
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