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designated "Ira S. Greene", in the amount of $206,332 and a net
profit in the amount of $120,185. On a supplemental schedule to
Form 4726, Maximum Tax on Personal Service Income, petitioner
reported total wages earned for 1981 in the amount of $6,000; his
wife Robin reported total wages earned in the amount of $40,594.
Petitioners' combined wages and Schedule C net earned income for
1981 totaled $166,779.
Petitioner acquired a 2.605-percent limited partnership
interest in Resource for $25,000 in 1981. As a result of his
investment in Resource, on their 1981 joint Federal income tax
return petitioners claimed an operating loss in the amount of
$20,533 and investment tax and business energy credits totaling
$42,402. Respondent disallowed in full petitioners' claimed loss
and investment tax and business energy credits related to
Resource.
Petitioner learned of the Plastics Recycling transactions
and Resource in 1981 from another bankruptcy attorney, Leon
Marcus (Marcus). Marcus informed petitioner that Resource was a
tax-advantaged investment or tax shelter and that he was
investing in a Plastics Recycling transaction. Petitioner was
"flattered" to be approached by Marcus. He described Marcus as
the senior partner in a "small law firm * * * [petitioner] was
at". Petitioner claims that Marcus "had a reputation of a very
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