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partnership interest offered by the Managing General Partner
on behalf of the Partnership, and no longer claim any loss
or Investment Tax Credit allocated to them by that
Partnership.
As a former General Partner, the Taxpayers now adopt the
position they became a co-owner/joint tenant in the herd of
cattle that was purchased in the name of the partnership on
the date of purchase, which they paid for by signing a full
recourse promissory note on Dec. 28, 1986. The Taxpayers
have now elected to combine their cattle with another
Partnership known as [SGE 84-2]. Accordingly, the Taxpayers
are now reporting the 1986 expenses from the cattle owned by
them on Schedule E, and the depreciation on Schedule F.
Taxpayers now claim, or will claim in 1987, the Investment
Tax Credit on their cattle as a transferee of used
transition property that was placed in service by the
transferor prior to the transfer. The Taxpayers have
obtained certain rights in a binding purchase agreement
signed by the transferor prior to December 31, 1985, for the
purchase of the cattle.
After filing the 1986 return, petitioner also filed a Form 1045,
Application for Tentative Refund, based on a carryback of a
claimed net operating loss (NOL) of $98,148 from 1986. This form
reflected the following:
1983 1984 1985
Adjusted gross income $34,618 $43,487 $38,065
Tax liability on original return 4,821 7,517 6,210
Tax liability after NOL carryback -0- -0- -0-
In addition to this Form 1045, there is in the record a copy of
another Form 1045 that reflects a credit carryback rather than an
NOL carryback. It is unclear whether this form was submitted to
respondent; regardless, it is clear that the Form 1045 reflecting
the NOL carryback was meant to supersede the other form. The
superseded Form 1045 reflected a carryback of a $16,868 general
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