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the years in issue, the controlling facts had changed materially.
Among other things, by this time, the Hoyt organization’s cattle
management “practices” had changed so that DF #1 “owned” (for tax
purposes) few, if any, actual individual breeding cattle. It is
thus extremely likely that the “14 heifers” purportedly
“transferred back” by DF #1 to the Hoyt organization in “payment”
of these notes (1) did not, in fact, exist and/or (2) were not
“owned” by DF #1 for tax purposes. See also the discussion infra
concerning Issue 8. We hold that DF #1 is not entitled to the
interest deductions it claimed for the years in issue on those
notes.
Issue 3. Certain Farm and “Other” Deductions40
As discussed supra in connection with Issue 1, the Court has
concluded DF #1, SGE 82-1, DGE 84-3, SGE 84-5, DGE 86-2, TBS 89-
1, and TBS 90-1 did not acquire the benefits and burdens of
ownership with respect to the breeding cattle each partnership
claimed to have acquired from the Hoyt organization.
Accordingly, we hold that these foregoing partnerships are not
entitled to the farm deductions they claimed for the years in
issue.
Petitioners have further failed to substantiate the “other
deductions” DF #1, SGE 82-1, and DGE 84-3 claimed for the 1990
40As indicated earlier, petitioners conceded the deductions
these cattle-breeding partnerships claimed for drought and
disease.
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