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indicating that it was not subject to TEFRA partnership
procedures. Secs. 6221-6233. Arcanum attached to its return 10
Schedules K-1, Partner’s Share of Income, Credits, Deductions,
etc. One Schedule K-1 identified the partner as “Arthur Stern
Jr. Account #2". Line C of that Schedule K-1 states that Arthur
Stern Jr. Account #2 is a trust. Another K-1 identified the
partner as “Stuart D. Grodd IRA Account”. Line C of that
Schedule K-1 states that Stuart D. Grodd IRA Account is an IRA.
The other 8 partners were individuals.
On October 9, 1992, Arcanum filed a petition with the
Bankruptcy Court for the Northern District of California under
Chapter 11 of the U.S. Bankruptcy Code. Charles E. Sims (Sims)
was the trustee for Arcanum’s bankruptcy estate. Arcanum did not
file partnership returns for 1991 or 1992. On December 9, 1993,
the bankruptcy court granted Arcanum’s motion to convert its
Chapter 11 proceeding to a Chapter 7 proceeding. Sims signed and
filed Arcanum’s 1993 partnership return in May 1995. He
indicated on the return that Arcanum was not subject to the TEFRA
partnership procedures. Attached to Arcanum’s 1993 partnership
return were 7 Schedules K-1, one of which identified the partner
as “Stuart D. Grodd IRA Account”, an IRA.
Respondent determined deficiencies in petitioner’s Federal
income taxes for 1991, 1992, and 1993, and additions to tax under
sections 6651(a)(1) and 6654 for those years. Respondent did not
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