Daniel L. and Ingrid N. Carroll - Page 27




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          637, 652-653 (1990), affd. without published opinion 956 F.2d 274           
          (9th Cir. 1992), affd. in part without published opinion sub nom.           
          Cowles v. Commissioner, 949 F.2d 401 (10th Cir. 1991).                      
               It is also clear that petitioners could not reasonably rely            
          on the advice of the Plastics Recycling promoters with respect to           
          the substantive merits or the tax treatment of items in                     
          connection with their investment in Clearwater.  See Patin v.               
          Commissioner, 88 T.C. 1086, 1131 (1987), affd. without published            
          opinion 865 F.2d 1264 (5th Cir. 1989), affd. sub nom. Gomberg v.            
          Commissioner, 868 F.2d 865 (6th Cir. 1989), affd. sub nom. Skeen            
          v. Commissioner, 864 F.2d 93 (9th Cir. 1989), affd. per curiam              
          without published opinion sub nom. Hatheway v. Commissioner, 856            
          F.2d 186 (4th Cir. 1988); Kleiger v. Commissioner, T.C. Memo.               
          1992-734.  Advice from such individuals “is better classified as            
          sales promotion".  Vojticek v. Commissioner, T.C. Memo. 1995-444.           
               Petitioners also claim that their decision to invest was               
          greatly influenced by the nature of the transaction, guaranteeing           
          them a profit based on “conservative” assumptions regarding the             
          price of resin and minimal output by the recyclers.  Based on               
          these assumptions, petitioners claim to have concluded that the             
          circular nature of the transaction in fact guaranteed them a                
          profit.  In this regard, petitioners claim that the circuitous              
          nature of the transaction did not alarm them because petitioner             







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