Jeffrey I. and Roberta H. Stone - Page 29

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          Court found that the taxpayer's personal expertise and insight in           
          the underlying investment gave him reason to believe it would be            
          economically profitable.  Although the taxpayer was not                     
          experienced in business or tax matters, he did consult with an              
          accountant and a tax lawyer regarding those matters.  Moreover,             
          the District Court noted that the propriety of the taxpayer's               
          disallowed deduction therein was "reasonably debatable."  See               
          Zfass v. Commissioner, T.C. Memo. 1996-167.                                 
               The records in these cases show that none of petitioners or            
          their supposed advisers had any formal education, expertise, or             
          experience in plastics or plastics recycling.  None of them had             
          any personal insight or industry know-how in plastics recycling             
          that would reasonably lead them to believe that the Partnership             
          transactions would be economically profitable.  The extent of               
          Tomasetti's, Frabotta's, and Omohundro's "investigation" was a              
          tour of PI's plant in Hyannis and a discussion with PI personnel            
          and insiders to the Partnership transactions.  No independent               
          experts in the field of plastics or plastics recycling were                 
          consulted by any of petitioners or their advisers.  The facts of            
          these cases are distinctly different from those in the Mollen               
          case.  Thus, we consider petitioners' arguments with respect to             
          the Mollen case inapplicable under the circumstances of these               
               Petitioner's arguments are not supported by the Ninth                  
          Circuit Court of Appeals' partial reversal of our decision in               

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