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The December 31, 1990, conversion rate of the Brazilian
cruzeiros was Cr$16,020,000 to US$1, and the conversion rate did
not vary significantly from the rate on the due date of the 1990
Coral note payment. Spencer Medical did not report the
difference between the 1983 value (US$700,000) and the 1990 value
(approximately US$39) of the Coral note principal payment due to
Coral in 1990 as gain on its 1990 return. Spencer Medical's 1990
return reflected a liability for interest in the total amount of
$384,586, payable on December 1, 1990. Spencer Medical did not
report the difference between the 1983 value (US$384,586) and the
1990 value (approximately US$0) of the Coral note accrued
interest payment due to Coral in 1990 as gain on its 1990 return.
Spencer Medical never paid the Coral note principal or the
interest accrued as of December 1, 1990, due on December 1, 1990.
Spencer Medical never received a demand for payment nor has any
other action been initiated by Coral to collect the principal and
accrued interest payment due from Spencer Medical on December 1,
1990.
Coral investments were sold by Allen F. Campbell (Campbell)
of Dallas, Texas, during 1982, 1983, 1984, and 1985 to more than
170 different entities throughout the United States. In March
1984, James I. Gibb (Gibb), a revenue agent, was assigned to the
"injunction group" in Dallas. The job of the injunction group
was to investigate promoters of abusive tax shelters.
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Last modified: May 25, 2011