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with the partners' interests in the partnership. In view of our
disposition of the first issue, we need not and do not decide the
validity of this allocation.
Unless otherwise indicated, section references are to the
Internal Revenue Code in effect for the years at issue, and Rule
references are to the Tax Court Rules of Practice and Procedure.
Throughout this Opinion, we use the terms "purchase", "sale",
"contingent installment sale", and "contingent payment sale"
solely for purposes of convenience and clarity. Our use of these
terms is not meant to give legal significance to the underlying
and surrounding transactions.
FINDINGS OF FACT
Some of the facts have been stipulated. The stipulations of
fact and attached exhibits are incorporated herein by this
reference. When the petition was filed, ACM's principal place of
business was in Wilmington, Delaware.
1. The Contingent Installment Sale Transaction
ACM is one of 11 partnerships (section 453 partnerships)
formed over a 1-year period from 1989 to 1990 by the Swap Group
at Merrill Lynch & Co., Inc.1 Each section 453 partnership was
intended to be a vehicle for sheltering capital gains of one of
its partners. For purposes of this Opinion, the principal
1 During the period at issue, Merrill Lynch & Co., Inc., was
a holding company that, through subsidiaries and affiliates,
provided various financial services. We use the name "Merrill"
to refer generally to the affiliated group or a member thereof.
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