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effect on LTD, its books or records, or any other aspect of the
partnership. Cf. Hambrose Leasing v. Commissioner, supra at 311.
While petitioner argues that it believes that LTD did not have an
indirect partner who was an individual, the finding of a
partnership item does not hinge on whether the item is
determinable from information actually available at the
partnership level. That finding turns on whether the partnership
is required to make a determination of the item. See Dakotah
Hills Offices Ltd. Pship. v. Commissioner, T.C. Memo. 1996-35;
cf. Dial U.S.A., Inc. v. Commissioner, 95 T.C. 1, 4 (1990).
Our conclusion as to the issue at hand is further supported
by analogy to two of this Court’s previous holdings. First, in
Hang v. Commissioner, 95 T.C. 74, 80 (1990), the Court held that
the determination of whether a father was the true and beneficial
owner of shares in an S corporation held in the name of his sons
was properly made at the individual shareholder level.4 We
reasoned that the true and beneficial ownership of the shares was
4 Under the S corporation audit and litigation procedures,
secs. 6241 through 6245, a “subchapter S item” denotes “any item
of an S corporation to the extent regulations prescribed by the
Secretary provide that, for purposes of this subtitle, such item
is more appropriately determined at the corporate level”. Sec.
6245. The tax treatment of a subch. S item generally must be
determined in an entity level proceeding. See sec. 6241. While
these S Corporation procedures were enacted shortly after the
TEFRA procedures as part of the Subchapter S Revision Act of
1982, Pub. L. 97-354, sec. 4(a), 96 Stat. 1691, the S Corporation
procedures were repealed as of Dec. 31, 1996, by the Small
Business Job Protection Act of 1996, Pub. L. 104-188, sec.
1307(c)(1), 110 Stat. 1781.
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