- 14 - There is a common denominator for determining whether the shares were qualified appreciated stock on the transfer date and whether petitioners are subject to the substantiation requirements. That common denominator is whether, on the transfer date, market quotations with respect to the shares were readily available on an established securities market. See sec. 170(e)(5)(B)(i); sec. 1.170A-13(c)(7)(xi)(A), Income Tax Regs.3 Because we find that, on the transfer date, market quotations with respect to the shares were not readily available on an established securities market, (1) the shares were not qualified appreciated stock, (2) petitioners are subject to the substantiation requirements (which they failed to satisfy), and (3) as a result of either (1) or (2), or both, they are not entitled to the disallowed deductions. 2(...continued) deduction in excess of $5,000 is claimed), no deduction is allowable. Respondent has, however, in effect, allowed a deduction of $33,338 for 1994. See supra, Respondent’s Adjustments. We have accepted such a concession in the past. Hewitt v. Commissioner, 109 T.C. 258, 266 (1997), affd. without published opinion 166 F.3d 332 (4th Cir. 1998). 3 The substantiation requirements apply unless, on the transfer date, the shares were “publicly traded securities to which � 1.170A-13(c)(7)(xi)(B) does not apply”. See sec. 1.170A- 13(c)(1)(i), Income Tax Regs. That condition is met only if, on the transfer date, with respect to the shares, market quotations were readily available on an established securities market, without application of the special rule found in subdiv. (B) of sec. 1.170A-13(c)(7)(xi), Income Tax Regs., and subject to the exception set forth in subdiv. (C) thereof. See sec. 1.170A- 13(c)(7)(xi)(A), Income Tax Regs.Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
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