Bernice M. and Stanley M. Ulanoff - Page 20




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          F.   Ultimate Finding of Fact                                               
               At all relevant times, the fair market value of the Sentinel           
          EPE recyclers and the Sentinel EPS recyclers did not exceed                 
          $50,000 per machine.                                                        
                                       OPINION                                        
               We have decided many Plastics Recycling cases.  The majority           
          of these cases, like the consolidated cases herein, presented               
          issues regarding additions to tax for negligence and valuation              
          overstatement.  See Greene v. Commissioner, T.C. Memo. 1997-296;            
          Kaliban v. Commissioner, T.C. Memo. 1997-271; Sann v.                       
          Commissioner, T.C. Memo. 1997-259 n.13 (and cases cited therein).           
          We found the taxpayers liable for the addition to tax for                   
          valuation overstatement in all of those cases and liable for the            
          additions to tax for negligence in all but two of those cases.              
          In a limited number of cases, the taxpayers also contested the              
          underlying deficiency arising from the disallowance of the losses           
          and various credits with respect to their plastics recycling                
          investment.  We sustained the Commissioner on the issue of the              
          underlying deficiency in every one of those cases.                          
          In Provizer v. Commissioner, T.C. Memo. 1992-177, (6th Cir.                 
          1993), a test case for the Plastics Recycling group of cases,               
          this Court: (1) Found that each Sentinel EPE recycler had a fair            
          market value not in excess of $50,000; (2) held that the                    
          transaction, which was almost identical to the transactions in              
          the present cases, was a sham because it lacked economic                    



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