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and experimental expense deduction for 1982 because it did not
directly or indirectly engage in research or experimentation. In
addition, we hold that Utah I was not actively involved in a
trade or business and also lacked a realistic prospect of
entering a trade or business. Nickeson v. Commissioner, 962 F.2d
973, 978 (10th Cir. 1992), affg. Brock v. Commissioner, T.C.
Memo. 1989-641; Zink v. United States, 929 F.2d 1015, 1021 (5th
Cir. 1991). Therefore, Utah I is not entitled to any additional
deductions for 1982 and 1983 under section 162(a).
This Court previously has addressed the deductibility of
purported research and development expenditures under section 174
by limited partnerships formed for the purported purpose of
engaging in agricultural research and development of the jojoba
plant. Cactus Wren Jojoba, Ltd. v. Commissioner, T.C. Memo.
1997-504; Glassley v. Commissioner, T.C. Memo. 1996-206;
Stankevich v. Commissioner, T.C. Memo. 1992-458. In the Cactus
Wren Jojoba Ltd., Glassley, and Stankevich cases, we held that
the taxpayers were not entitled to deductions for research and
experimental expenditures under circumstances similar to those
presented in this case.
The evidence presented in this case persuades us that the
R&D agreement before us was mere window dressing, designed and
entered into solely to decrease the cost of participation in the
jojoba farming venture for the limited partners through the
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