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Held, further: Partnership correctly computed the basis in
the player contracts under the subch. K basis adjustment
sections and regulations thereunder.
Richard P. Slivka and Charles D. Henson, for petitioner.
Randall L. Preheim, for respondent.
GERBER, Judge: Respondent issued notices of final
partnership administrative adjustments to P.D.B. Sports, Ltd.,
for the taxable years 1989 and 1990. Among other adjustments,
respondent disallowed amortization in the amounts of $1,878,056
and $259,255 for 1989 and 1990, respectively, claimed with
respect to professional football player contracts. After
concessions, the sole issue remaining for our consideration is
whether the partnership, for purposes of determining the
amortizable basis in player contracts, is subject to section
10561 in addition to, in conjunction with, or instead of the
subchapter K partnership provisions. Petitioner contends that
the partnership provisions apply exclusively and would, in this
case, permit the amortization of the fair market value of the
player contracts. Conversely, respondent contends that section
1056 applies to limit amortization to an amount equal to the
seller's basis, plus any gain recognized by the seller. In
1 All section and subchapter references are to the Internal
Revenue Code in effect for the years in issue, and all Rule
references are to the Tax Court Rules of Practice and Procedure,
unless otherwise indicated.
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