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Provizer v. Commissioner, T.C. Memo. 1992-177. In Provizer, our
finding that the recyclers were overvalued was the dominant
factor that led us to hold that the transaction lacked economic
substance. See Sann v. Commissioner, T.C. Memo. 1997-259.
Similarly, in the present cases the overvaluation of the
recyclers was a dominant factor in regard to: (1) The disallowed
tax credits, and other benefits in these cases; (2) the
underpayments of tax; and (3) the determination that the Hamilton
transaction lacked economic substance.
Lastly, we note that petitioners’ argument is similar to the
arguments that were raised in other plastics recycling cases.
See Merino v. Commissioner, T.C. Memo. 1997-385, affd. 196 F.3d
147 (3d Cir. 1999); Singer v. Commissioner, T.C. Memo. 1997-325;
Kaliban v. Commissioner, T.C. Memo. 1997-271; Sann v.
Commissioner, supra. In all of those cases, we rejected this
argument.
2. Concession of the Deficiency
Petitioners also argue that Hamilton’s concession in the
underlying partnership case precludes imposition of the section
6659 additions to tax. Petitioners contend that Hamilton’s
concession renders any inquiry into the grounds for such
deficiencies moot. Petitioners argue that absent such inquiry it
cannot be known whether their underpayments were attributable to
a valuation overstatement or other discrepancy and that without a
finding that a valuation overstatement contributed to an
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