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Spears we refer to William Spears (Spears), and in discussing or
mentioning petitioners Farrell we refer to Vincent Farrell
(Farrell).
On April 22, 1992, respondent and Farrell filed a
Stipulation of Settled Issues resolving all issues except for
issues relating to his participation in the Plastics Recycling
Program during taxable year 1982.3 On March 31, 1994, respondent
and Farrell filed another Stipulation of Settled Issues
addressing the issues relating to his participation in the
Plastics Recycling Program. A virtually identical Stipulation of
Settled Issues was filed by respondent and Spears on March 9,
1994. These stipulations provide:
1. Petitioners are not entitled to any deductions,
losses, investment credits, business energy investment
credits or any other tax benefits claimed on their tax
returns as a result of their participation in the
Plastics Recycling Program.
2. The underpayments in income tax attributable to
petitioners' participation in the Plastics Recycling
Program are substantial underpayments attributable to
tax motivated transactions, subject to the increased
rate of interest established under I.R.C. �6621(c),
formerly �6621(d).
3 Farrell and respondent stipulated: (1) Mr. and Mrs. Farrell
are liable for a deficiency in the amount of $29,589 for taxable
year 1980; (2) $14,795 of that amount is subject to the increased
rate of interest under sec. 6621(c); (3) the loss of $1,906
claimed on Schedule E of their 1982 Federal income tax return,
and the corresponding adjustment in the notice of deficiency,
relate to their investment in SAB Associates; and (4) they are
entitled to deduct $381 with respect to their interest in SAB
Associates for 1982.
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