Life Care Communities of America, Ltd., A Florida Limited Partnership, Robert W. McMichael, A Partner Other Than The Tax Matters Partner - Page 6

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          relating to FMS and the management company and filed a refund               
          suit in the United States District Court for the Middle District            
          of Florida.  On June 10, 1998, the District Court entered a                 
          judgment against petitioner and determined that petitioner                  
          transferred his shares in FMS and the management company to Smith           
          and Fowler on June 30, 1990.  On November 16, 1999, the Court of            
          Appeals for the Eleventh Circuit affirmed the District Court’s              
               At the time the petition was filed, the partnership                    
          maintained its principal place of business in Naples, Florida.              
               Petitioner contends that on January 12, 1989, the 1989                 
          agreement divested him of his partnership interest.2  Respondent            
          contends that petitioner was not divested of his interest until             
          June 30, 1990, the date of the purchase agreement.  We agree with           
               In 1986, Smith and Fowler voted to remove petitioner from              
          his management position.  In 1987, petitioner filed a lawsuit for           
          damages and ultimately reached a settlement with Smith and                  
          Fowler.  The 1989 agreement provided a number of options to                 
          effect the change in ownership of the partnership.  Petitioner’s            

               2  Sec. 7491 is inapplicable because the examination of                
          petitioner's returns began before the statute's effective date.             
          Thus, petitioner bears the burden of proof on all questions of              
          fact.  Rule 142(a); Monahan v. Commissioner, 109 T.C. 235, 236              

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