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because the revenue from the expected energy savings would be
utilized to make lease payments. He expected to recoup his
investment by means of the tax benefits.
Petitioner was married to Sally Upchurch from 1961 to 1985,
when they were divorced. Petitioner filed joint returns for
1980, 1981, and 1982 with Sally Upchurch, who had prepared the
returns. Their 1983 Federal income tax return and claim for
refund of 3 prior years' taxes were prepared by Mr. Shriver, and
after claiming the pass-through deduction and credits from
Evergreen, petitioner, and Sally Upchurch received refunds and
tax reductions which exceeded his out-of-pocket expenditure by
about $3,000.
After the investment in Evergreen and the receipt of the tax
benefits, including the refunds, petitioner did not pursue or
keep track of his investment in the partnership or the energy
device or its operation. Petitioner thought that Mr. Chalich and
others from Professional had attempted to contact Saxon Energy in
New York City. Ultimately, petitioner agreed with respondent
that he was not entitled to the investment tax credits and
deductions purportedly generated by investment in the energy
device.
OPINION
Petitioner concedes that he is liable for the underlying
income tax deficiencies, but contends that he is not liable for
the additions to tax and increased interest. In that regard,
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