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Farms. On the same date they received the notes, petitioners
assigned the notes to their partnership, TMC Enterprises. TMC
Enterprises was a general partnership in which petitioners were
equal partners during the years in issue.
On April 1, 1984, the debts owed by RAM Drilling and TMC
Farms to TMC Enterprises were restructured as zero percent
convertible subordinated debentures in the total amounts of
$3,195,285 and $1,655,000, respectively.
In the notices of deficiency, respondent determined, among
other things, that petitioners were liable for additional taxes
as a result of: (1) Imputed interest income on promissory notes
from RAM Drilling and TMC Farms pursuant to section 482, and
(2) the incorrect valuation of the RAM Drilling stock for
purposes of the section 337 liquidation of TMC Resources. (This
second issue was not in the notice of deficiency for 1979 and
1984 for Marcus R. Messman. Marcus R. Messman received two
notices of deficiency.) Petitioners raised only these two
issues in their petitions.
The parties eventually settled the issue of the value of
RAM Drilling stock for purposes of the section 337 liquidation
of TMC Resources. On March 10, 1993, the case proceeded to
trial on the remaining section 482 imputed interest income
issue.
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