Robert R. Plante and Mary B. Plante - Page 9

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          ordinary loss of $693,492 from the sale of such stock.  Also on             
          amended returns, a net operating loss in the amount of $655,191             
          was carried back to 1988, and then forward into 1989 and 1990, in           
          the amounts of $601,814 and $591,629, respectively.                         
               On their 1992 Federal income tax return, petitioners claimed           
          a net operating loss carryover deduction in the amount of                   
          $587,581, the source of which is not readily identifiable on the            
          return, but apparently relates to the sale of petitioner's BCBI             
          stock.  Petitioners' amended returns for the years 1988 through             
          1991, all of which claimed refunds, and their 1992 return were              
          prepared by Thomas A. Lawler, Esq., who is also their counsel of            
          record in this case.                                                        
               In the notice of deficiency, respondent determined that                
          petitioner suffered a loss of $693,492 ($1,743,793 basis, minus             
          $1,050,000 realized) on the sale of his BCBI stock and further              
          determined, pursuant to section 1244, that petitioners were                 
          limited to an ordinary loss deduction of $100,000 in 1991 from              
          the transaction.3  Respondent treated the balance of the loss               

               3 It would appear that respondent was unaware of or                    
          disregarded the allocation schedule in the agreement, potentially           
          allowing petitioners (at least with respect to the amounts                  
          attributed to the covenant not to compete and consulting                    
          services) to offset ordinary income by long-term capital loss in            
          excess of the amounts otherwise allowable under sec. 1211(b).  We           
          cannot tell at this point whether treating the sale of                      
          petitioner's option in the real estate as though it were                    
          inherently part of the sale of his BCBI stock worked to                     
          petitioners' advantage or disadvantage for Federal income tax               

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