Davenport Recycling Associates, Sam Winer, Tax Matters Partner - Page 26

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          Michigan law, a partnership must be renewed after a certain                 
          period of time or it will expire.  Lichtenstein did not renew DL            
          & Associates' status as a partnership.                                      
          G.  The Modified Injunction                                                 
               Miller had received a copy of the February 1986 Final                  
          Consent and Permanent Injunction from Winer.  Sometime in late              
          April or early May 1986, Miller read the proposed TEFRA                     
          partnership regulations which had been reprinted in the April 17,           
          1986, issue of the Daily Tax Report, a publication of the Bureau            
          of National Affairs.  After reviewing the proposed TEFRA                    
          partnership regulations, Miller, on May 6, 1986, wrote to Winer             
          regarding Winer's settlement of his section 7408 injunction case            
          with the United States.  Miller also sent copies of this letter             
          to Fieldstone and Davis.                                                    
               In his letter, Miller informed Winer that he believed                  
          Winer's settlement of the section 7408 injunction proceeding                
          action was invalid because:  (1) Winer had not resigned as TMP in           
          accordance with the proposed TEFRA partnership regulations; and             
          (2) only general partners could be designated as TMP's.  It was             
          Miller's belief that certain provisions in the proposed                     
          regulations:                                                                
               confirm that what you did in the settlement process is                 
               probably invalid and, should the Proposed Regulations                  
               be promulgated in the form in which they are proposed,                 
               certain additional steps will have to be taken before                  
               your resignation as tax matters partner can be                         
               effective and before the successor tax matters partner                 
               can be properly designated.                                            




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