- 6 -
petitioner and Mr. Ellison. Letters and other documents provided
to petitioner and Mr. Ellison by the Hoyt organization referred
to petitioner and Mr. Ellison as partners and listed “Don & Pam
Ellison” under the heading of partner’s name.
Petitioner and Mr. Ellison received promotional materials
from the Hoyt organization about the Hoyt partnerships. Mr.
Ellison kept these materials in his files. One of the
promotional materials included the following language under the
heading Specific Risks Involved: “A change in the tax laws or an
audit and disallowance by the IRS could take away all or part of
the tax benefits, plus the possibility of having to pay the tax
along with penalties and interest”. It further stated:
This term [“head torn off”] is crude but, it is a
concept that is very applicable to the comparison of
having a disallowance of your partnership tax
deductions by the Internal Revenue Service. The
prospect of having to pay the taxes when you have put
your tax money into a tax shelter, and it’s gone, is a
financial wreck.
The brochure went on to state that there was no assurance that
things would be “O.K.” In discussing the preparation of investor
tax returns, the promotional materials warned “there is a risk”
and stated that after many years of experience with tax shelters
the Hoyt partnerships have learned how “to deal with IRS audits
of the Partnerships’ returns and the Partners’ personal returns,
(being ‘attacked’ by the IRS)”. The promotional materials also
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011