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Respondent determined deficiencies of $4,875, $4,875, and
$1,514 in petitioner’s Federal income taxes for the taxable years
2000, 2001, and 2002, respectively. The deficiencies were due to
respondent’s disallowance of a tax credit regarding petitioner’s
investment in pay telephones (pay phones) for each of the years
in issue.
The sole issue for decision is whether petitioner is
entitled to claim tax credits under section 44 for his
investments in the pay phones for 2000, 2001, and 2002.
We note that the Court recently issued an Opinion in the
case of Arevalo v. Commissioner, 124 T.C. 244 (2005). The facts
in this case, relating to the investments in pay phones, are
virtually identical to the facts in Arevalo. Thus, the Opinion
in Arevalo is controlling.
Background
Some of the facts have been stipulated, and they are so
found. The stipulation of facts and the attached exhibits are
incorporated by this reference. Petitioner resided in Phoenix,
Arizona, at the time the petition was filed.
Petitioner entered into three separate contracts dated
August 18, 2000, November 7, 2000, and January 2, 2001, with ATC,
Inc. (ATC), a wholly owned subsidiary of Alpha Telcom, Inc.
(Alpha Telcom), entitled “Telephone Equipment Purchase Agreement”
(ATC pay phone agreements).
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