ACM Partnership, Southampton-Hamilton Company, Tax Matters Partner - Page 131

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          benefits, unintended by Congress, by means of transactions that             
          serve no economic purpose other than tax savings.  Yosha v.                 
          Commissioner, 861 F.2d 494, 498-499 (7th Cir. 1988), affg.                  
          Glass v. Commissioner, 87 T.C. 1087 (1986); see also Estate of              
          Thomas v. Commissioner, 84 T.C. 412, 432-433 (1985), and the                
          cases cited therein.                                                        
               Our conclusion is supported by well-settled judicial                   
          jurisprudence.  In the seminal case of Gregory v. Helvering,                
          293 U.S. 465, 469 (1935), the Court recognized an individual's              
          right to decrease her taxes in any way permitted by law.  As held           
          by the Court, however, this right is not absolute.  The Court               
          held that a reorganization that met the literal requirements of             
          the Code would not be respected for Federal income tax purposes             
          because "what was done, apart from the tax motive, was [not] the            
          thing which the statute intended".  The Court stressed that the             
          transaction had "no business or corporate purpose", but was "a              
          mere device which put on the form of a corporate reorganization             
          as a disguise for concealing its real character".  Id.                      
               In the 60 years since the U.S. Supreme Court first expounded           
          this doctrine of "business purpose", the doctrine's application             
          has proved a perennial challenge to the courts to set boundaries            
          between acceptable tax planning and abuse, while taking into                
          account the importance of maintaining public confidence in the              
          integrity of the tax system.  In Knetsch v. United States,                  






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