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this Court disallowed in Wolverine. As a result, his first
argument is without merit.
Second, petitioner contends that he was reasonable in taking
the deductions because he was duly diligent in determining
whether the agreement was binding. In essence, petitioner asks
us to believe that it was reasonable to ignore the transactions'
lack of economic substance and to rely on a conditional,
precursory agreement that was not applicable to the year in
issue. We decline to do so. While petitioner contends that he
believed and continues to believe that the agreement was binding,
his opinion letter indicates that he was fully aware that the
agreement by its terms was not binding and did not apply to 1983,
the year in issue. Petitioner's opinion letter stated:
Even though as a matter of law each taxable year stands
by itself and the Internal Revenue Service is entitled
to change its position, since you have reached an
agreement in principle with the Internal Revenue
Service for the years 1977-1982 for your partnerships
and since the planning for the years 1978-1982 is
substantially similar to the planning for 1983 and
since it is anticipated that the Internal Revenue
Service will apply the principles of the settlement by
1983, my opinion that the significant tax benefits of
the investment are likely to be realized is
substantially strengthened. [Emphasis added.]
Petitioner also claims to have been duly diligent in that he
obtained outside counsel who advised him that the agreement was
binding. Petitioner did not, however, produce any documentation
in support of this contention. We are not required to, and in
this case do not, accept the taxpayer's uncorroborated testimony.
See, e.g., Tokarski v. Commissioner, 87 T.C. 74, 77 (1986).
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