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7443A(b)(4) and Rules 180, 181, and 183.2 The Court agrees with
and adopts the opinion of the Special Trial Judge, which is set
forth below.
OPINION OF THE SPECIAL TRIAL JUDGE
WOLFE, Special Trial Judge: Cactus Wren Jojoba, Ltd.
(Cactus Wren) is a Texas limited partnership to which the
provisions of sections 6221-6233 (the TEFRA partnership
provisions)3 are applicable. By notice of final partnership
administrative adjustment (FPAA) respondent determined the
following adjustments to the partnership return of income of
Cactus Wren for the taxable year 1983: (1) Disallowance of
$164,057 claimed as qualified research and development
expenditures under section 174; and (2) disallowance of $10,500
claimed as a deduction for tax counseling fees. Respondent also
determined that, in the alternative, if the research and
experimentation expenditure were allowed as a deduction, it would
be an item of tax preference under section 57(a)(6). Cecil R.
Almand (Almand), as tax matters partner (TMP), timely filed a
petition with this Court.
2 All section references are to the Internal Revenue Code in
effect for the tax years in issue, except as otherwise indicated.
All Rule references are to the Tax Court Rules of Practice and
Procedure.
3 The so-called TEFRA partnership provisions, secs. 6221-6233,
were added to the Code by the Tax Equity and Fiscal
Responsibility Act of 1982 (TEFRA), Pub. L. 97-248, sec. 402(a),
96 Stat. 648.
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