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of the Court in Durkin that the bonus payments were used by
Shelburne and Century as a mechanism to divert funds "for the
benefit of the members of the law firm or their immediate
families", determined that Kanter realized income from these
bonus payments as a member of the law firm of Levenfeld and
Kanter.
On brief, respondent acknowledges that Durkin did not
address the question of whether the family entities or the LK
partners (the partners of the Levenfeld and Kanter law firm),
individually, were taxable on the bonus payments paid by
Shelburne to Delta. Respondent, nevertheless, argues that Kanter
is taxable on his share of the bonus payments paid by Shelburne
and Century to Alpha and Delta. As noted earlier, CMS Investors
was a partner in Alpha and Delta. Respondent determined that
Kanter, and not Holding Co., was the partner in CMS Investors,
and, accordingly, the bonus payments that were allocable to
Holding Co. as a partner in CMS Investors were, instead,
allocable to Kanter individually.
Kanter contends that this Court lacks subject matter
jurisdiction because the Levenfeld and Kanter law firm was a
TEFRA partnership during each of the years at issue, and, in
fact, respondent issued an FPAA to the law partnership, which
included the subject adjustment for the year 1994. He also
contends that respondent is collaterally estopped from
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