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Unless 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
Procedure.
After concessions, the issue for decision is whether for
1995 petitioner is entitled to a bad debt deduction in the amount
of $3,207,578. This issue turns on whether, for purposes of
section 166, certain fund transfers that petitioner made to
Blackland Investment Co., Inc. (Blackland), a corporation that
petitioner appears to have controlled, constituted loans and, if
so, whether such loans became worthless in 1995. Resolution of
this issue will affect net operating loss carrybacks that
petitioner claims for 1992 and 1993.
Certain books and records and other information relating to
petitioner, to ownership and operation of Blackland, and to the
transactions at issue herein are not in evidence. As a result,
aspects of our Findings of Fact are not as specific as they
should be. Petitioner is largely responsible for the situation
in which we find ourselves, as petitioner himself (and other key
individuals) did not testify at trial.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
In 2000, at the time the petition was filed, petitioner, a
German national, resided in Italy.
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