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increased rate of interest charged on “substantial underpayment
attributable to tax motivated transactions” under section
6621(c).3 The issues for decision in these cases are: (1)
Whether petitioners are entitled to farming expense deductions
and to general business credits that they claimed with respect to
an investment in a sheep breeding partnership promoted by Walter
J. Hoyt, III (Mr. Hoyt); (2) whether petitioners are liable for
the additions to tax for (a) valuation overstatements and a gross
valuation misstatement, (b) negligence or disregard of rules or
regulations, and (c) substantial understatements of income tax;
(3) whether petitioners are liable for the increased rate of
interest charged on substantial underpayments attributable to tax
motivated transactions; and (4) whether respondent is equitably
estopped from imposing additions to tax and interest on the
deficiencies in these cases.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulation of facts and the attached exhibits are
3References to sec. 6621(c) are to sec. 6621(c) as in effect
with respect to interest accruing after Dec. 31, 1986. See Tax
Reform Act of 1986, Pub. L. 99-514, sec. 1511(d), 100 Stat. 2746.
For interest accruing before that date, but after Dec. 31, 1984,
a nearly identical provision was codified at sec. 6621(d). See
id. sec. 1511(c)(1)(A), 100 Stat. 2744; Deficit Reduction Act of
1984, Pub. L. 98-369, sec. 144(a), (c), 98 Stat. 682, 684. Sec.
6621(c) was repealed in 1989 with respect to returns due after
Dec. 31, 1989. Omnibus Budget Reconciliation Act of 1989(OBRA
1989), Pub. L. 101-239, sec. 7721(b), (d), 103 Stat. 2399, 2400.
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