Bruce and Lois Zenkel, et al. - Page 26

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          the full extent of his investigation, such as his visit to PI,              
          speaking with Canno, and his research of trade journals to                  
          confirm the price of plastic pellets.  Becker never represented             
          that he was an expert in plastics materials or plastics                     
          recycling.  Selvin did not do any independent investigation of              
          the Sentinel EPE recyclers or plastics recycling in general.  He            
          invested in Scarborough based solely on his review of the                   
          offering materials and his discussions with Becker.                         
               After the 1981 SAB Recycling Partnerships closed, Becker               
          paid Selvin's accounting firm to send an accountant to PI to                
          confirm, by serial number, that as of December 31, 1981, the                
          equipment that was leased to the 1981 SAB Recycling Partnerships            
          was indeed available for use.  Becker arranged for this                     
          verification, independent of PI, because he understood that the             
          investment tax and business energy credits would not be available           
          if the qualifying property was not available for use.                       
                                       OPINION                                        
               We have decided more than 30 of the Plastics Recycling group           
          of cases.2  The majority of these cases, like the consolidated              

          2         Provizer v. Commissioner, T.C. Memo. 1992-177, affd.              
          without published opinion 996 F.2d 1216 (6th Cir. 1993),                    
          concerned the substance of the partnership transaction and also             
          the additions to tax.                                                       
               The following cases concerned the addition to tax for                  
          negligence, inter alia:  Estate of Busch v. Commissioner, T.C.              
          Memo. 1996-342; Spears v. Commissioner, T.C. Memo. 1996-341;                
          Stone v. Commissioner, T.C. Memo. 1996-230; Reimann v.                      
                                                             (continued...)           





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