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Petitioners argue that reliance on an adviser who is a
promoter may be reasonable under precedents from the Court of
Appeals for the Tenth Circuit, to which appeal lies in this case.
The first case petitioners cite is Anderson v. Commissioner,
supra. In Anderson, the taxpayer relied on both an investment
adviser and an accountant in making his investment. The court
found that reliance on the investment adviser, who received a
commission for selling the investment to the taxpayer, was
reasonable under the circumstances of the case. However, the
court stressed that the investment adviser was not affiliated
with the corporation which had entered into the agreement with
the taxpayers. On the contrary, the adviser was an independent
insurance agent and registered securities dealer who presumably
would have received a commission on any investment he sold to the
taxpayer. See id. at 1271.
The second case petitioners cite is the unpublished opinion
of Gilmore & Wilson Constr. Co. v. Commissioner, 166 F.3d 1221,
83 AFTR 2d 99-457, 99-1 USTC par. 50,186 (10th Cir. 1999), affg.
Estate of Hogard v. Commissioner, T.C. Memo. 1997-174.3 In that
3Gilmore & Wilson Constr. Co. is an unpublished opinion of
the Court of Appeals for the Tenth Circuit. Although unpublished
decisions generally are not binding precedent in the Tenth
Circuit and citation thereto is disfavored, that court allows
citation to such a decision where “(1) it has persuasive value
with respect to a material issue that has not been addressed in a
published opinion; and (2) it would assist the court in its
disposition.” 10th Cir. Rule 36.3. Gilmore & Wilson Constr. Co.
(continued...)
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