- 11 - until he "received a bill from the IRS." Karras testified that he "couldn't believe that the case was over with and nobody had told us anything." In the end, Karras was "bowled over" by the size of the tax liability that had resulted from his "simple $50,000 investment." E. The Winer Section 7408 Injunction Proceeding In 1984, Winer and Winer Development Corp. were identified by respondent as persons who had violated section 6700 by promoting or selling partnerships or other arrangements that included gross valuation overstatements. Subsequently, respondent issued prefiling notification letters to Winer and the notice partners of Davenport, including participants, regarding Davenport on April 14, 1984. These letters stated that the Internal Revenue Service (IRS) planned to review the 1982 and 1983 tax returns of each investor in Davenport for claimed tax deductions and credits resulting from an investment in the partnership, which had been identified as a tax shelter. The letters indicated that the IRS did not believe the purported tax deductions and/or credits were allowable and that if such tax deductions and/or credits had been claimed by the investor, his or her return would be audited. The investor also was provided an opportunity to file an amended return. On April 13, 1984, respondent, through the Office of District Counsel in Jacksonville, authorized the U.S. Department of Justice (DOJ) to seek injunctions under section 7408 againstPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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