William L. Richter - Page 10

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          prepared for petitioner showing an allocation to petitioner of              
          $650 of nonpassive income and $650 of depreciation.  The                    
          allocation of $650 of nonpassive income was attributable to the             
          $650 petitioner was scheduled to receive from HEH in late 1996              
          pursuant to the partnership agreement.                                      
               Prior to November 5, 1990, individual taxpayers were                   
          permitted to claim a residential energy credit against their                
          income tax liability.  Sec. 23(a)(2),3 (b)(2), and (c)(2)(A), (5)           
          (before its repeal by the Omnibus Budget Reconciliation Act of              
          1990 (OBRA), Pub. L. 101-508, sec. 11801(a)(1), 104 Stat. 1388-             
          520).  Effective November 5, 1990, OBRA sec. 11801(a)(1) repealed           
          the residential energy credit for individuals.  The energy                  
          credit, however, continued to be deductible after 1990 as part of           
          the general business credit available to certain taxpayers,                 
          including certain trusts and estates.  Sec. 38; see also sec.               
          50(d) (providing that, in calculating the general business credit           
          authorized by sections 46, 48, and 50, the rules of section 48(f)           
          relating to certain estates and trusts continue to apply).                  

          because the original return reported distributions incorrectly as           
               3Unless otherwise indicated, all section references are to             
          the Internal Revenue Code in effect for the year in issue, and              
          all Rule references are to the Tax Court Rules of Practice and              

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