Bill L. and Patricia M. Spencer - Page 33

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               Petitioners argue that we should respect the form of the               
          transactions as stipulated, yet they themselves failed to respect           
          the form that they advocate.  While no single factor is                     
          conclusive, we believe that the defects in form that we have                
          discussed above, when viewed as a whole, demonstrate that the               
          substance of the transactions in issue was that SSI sold its                
          business and operating assets to SPC-SC and SPC-FL.  Petitioners            
          rely on Gilday v. Commissioner, T.C. Memo. 1982-242, n.8, for the           
          proposition that courts have been lenient to taxpayers who did              
          not take all of the steps in a transaction when to do so would              
          result in the utilization of fruitless steps.  We think                     
          petitioners' reliance on Gilday is misplaced because the defects            
          in form that we have discussed above are not merely "fruitless              
          steps".  Generally, a transaction is to be given its tax effect             
          in accord with what actually occurred and not in accord with what           
          might have occurred.  Don E. Williams Co. v. Commissioner, supra            
          at 579-580.  Mr. Spencer testified that he was advised by his               
          certified public accountant as to how to arrange the transactions           

          question were sold by SSI to SPC-FL for a consideration of                  
          $1,150,000.  We note that in his testimony at trial, Mr. Spencer            
          disputed the accuracy of the documentation concerning the Florida           
          transaction.  Mr. Spencer asserts that he had no knowledge of the           
          Form 8594 filed with SPC-FL's 1990 Form 1120S.  Mr. Spencer                 
          further insists that the Form erroneously discloses SPC-FL as the           
          purchaser of the assets in question.  We do not rely solely on              
          the Form 8594 in reaching our conclusion that in substance SSI              
          sold its business and assets to SPC-SC and SPC-FL.                          

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