- 63 -
years (1982-85) against "phantom income" reported in later
years from the Trust transaction is consistent with our
holding in Robertson I. In Kazi v. Commissioner, T.C.
Memo. 1991-37, affd. without published opinion sub nom.
Massey v. Commissioner, 950 F.2d 723 (3d Cir. 1991), the
Court refused to accept the taxpayers' argument that the
deficiency attributable to a straddle loss should be
reduced by the amount of any tax paid on the corresponding
straddle gain reported in a subsequent year. The Court
stated:
Our holding * * * that the straddle transactions
were shams in substance does not imply that the
loss reported in one year must be offset by the
corresponding gain reported in a subsequent year.
Therefore, the elimination of the gain and loss
legs in the year each gain or loss was reported
gives full effect to our holding that the
straddle transactions were shams. [Id.]
As mentioned above, petitioners also argue that
respondent's computation is wrong because it fails to
recognize petitioners' cash investment of $57,420 in the
Roscrea Trust. They contend that, according to the Court's
opinion, petitioners acquired a partial interest in the
computer equipment, and they are entitled to depreciation
deductions with respect to the amount of their actual cash
investment. We disagree.
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