- 14 -
Inc. note to CA Motors, Ltd., in exchange for a 20-percent limited
partnership interest, and (3) Mr. Caracello contributed the
$222,133 Coggin-O’Steen Motors, Inc. note to CFP Motors, Ltd., in
exchange for a 5-percent limited partnership interest. By
September 30, 1993, the aforementioned notes were canceled.
Each partnership agreement provided that the general partner,
i.e., one of the newly formed S corporations, would have control
over the operations of the partnership. Further, each partnership
agreement provided that the general manager/limited partner had to
tender his partnership interest to the partnership in the event he
left.
Immediately following the transfers of assets to the
partnerships, the subsidiaries were liquidated. As a result,
petitioner obtained the subsidiaries’ limited partnership
interests.
On or about August 27, 1993, petitioner elected S corporation
status, effective June 27, 1993. At the time of the election, no
changes were made to petitioner’s capital structure or to the
ownership interests in its stock.
Subsequent Transactions
On November 1, 1993, Mr. Hanania acquired an additional 20-
percent limited partnership interest in CA Motors, Ltd., for
$179,707. Subsequently, he purchased another 10-percent limited
partnership interest for $101,103. Ultimately, on July 1, 1996,
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011