- 34 -
finding in Provizer that the recyclers had been overvalued was
integral to and inseparable from our holding of a lack of
economic substance. Petitioners stipulated that the transaction
in Masters was substantially similar to the transaction described
in Provizer, and that the fair market value of the recyclers in
1982 was not in excess of $50,000. Given those concessions, and
the fact that the records here plainly show that the
overvaluation of the recyclers was integral to and inseparable
from the determination that Masters lacked economic substance, we
conclude that the deficiencies were attributable to the
overvaluation of the recyclers.
For the foregoing reasons, we hold that petitioners are
liable for the section 6659 additions to tax for valuation
overstatement.
To reflect the foregoing,
Decisions will be entered
for respondent.
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