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SWIFT, Judge: For petitioner’s taxable years ending
January 31, 1992, 1993, and 1994, respondent determined
deficiencies in petitioner’s Federal income taxes and accuracy-
related penalties as follows:
Accuracy-Related Penalty
Year Deficiency Sec. 6662(a)
1992 $1,171,365 $234,273
1993 684,700 136,940
1994 4,559,237 911,847
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
The primary issue for decision is whether the transfer of
petitioner’s interests in multilayered leases of computer
equipment and related trusts had business purpose and economic
substance and should be recognized for Federal income tax
purposes and whether petitioner should be entitled to the
$22 million in claimed ordinary business expense deductions
relating thereto.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
At the time the petition was filed, petitioner’s principal
place of business was located in Jericho, New York.
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