- 47 -
audit had resulted in no change. They agreed to the overall plan
with the objective of making a profit and personally monitored
the investment. In Wood, a group of consolidated cases, a
financial planner recommended the investment, all of the
taxpayers had profit objectives, the transactions were not sham
transactions, and one pair of taxpayers inspected the equipment
at issue. In the Davis case, the taxpayers relied in part upon
the express recommendation of a "trusted and long-term adviser",
and in part upon their review of the offering materials, which
did not reflect that the principals in the venture lacked
experience in the pertinent line of business.
The facts of petitioners' cases differ in several key
respects from the Wright, Wood, and Davis cases. Unlike the
Wright and Wood cases, petitioners' purported advisers were not
financial planners actively seeking out investment opportunities
for them. In contrast to all three cases, petitioners' purported
advisers did not expressly recommend that they invest in the
Partnerships. Also, none of petitioners read the offering
memoranda, saw a Sentinel EPE recycler, or made any effort to
learn about the Plastics Recycling transactions beyond discussing
them with Alter and Feinstein. In addition, the Partnership
transactions are shams lacking economic substance, and we are not
convinced that any of petitioners had an honest objective of
Page: Previous 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 NextLast modified: May 25, 2011