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3. Sale of Cashmere Stock by WACO to Equity Financial
Kanter provided a legal opinion, dated September 1, 1983, to
Equity Financial regarding "certain matters in conjunction with
the purchase * * * of Cashmere Investments Associates, Inc."
On September 2, 1983, Waco sold the Cashmere stock to Equity
Financial for $1,647,500, which was paid by check. Cashmere had,
as assets, cash of $498,500, consequently the remainder of the
consideration, $1,149,000 related to the acquisition costs of the
partnership interests. Zell and Lurie were not interested in the
Cashmere stock. Their sole interest was to buy the partnership
interests outright, but this was the only way that Kanter would
permit the sale.
Immediately after the sale, Zell and Lurie liquidated
Cashmere because its limited purpose was fulfilled.
4. How Sale of Cashmere Stock Was Reported on Tax Returns
Kanter did not report any income from, nor in any way
reflect, the installment sale of Cashmere stock on his 1983 and
1986 Federal tax returns.
Kanter reported installment sale income on Forms 6252
attached to his 1984 and 1985 Federal tax returns, as follows:
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