-283-
6662(d)(2)(C)(iii), and petitioner must demonstrate a reasonable
belief that SMP’s and Corona’s tax treatment of the transactions
in question was more likely than not the proper treatment. Given
Mr. Lerner’s education, sophistication, and tax experience, as
well as the particular circumstances of these cases, we do not
believe that there was such a reasonable belief.
A taxpayer is considered reasonably to believe that the tax
treatment of an item is more likely than not the proper tax
treatment if the taxpayer reasonably relies in good faith on the
opinion of a professional tax adviser; and if the opinion is
based on the tax adviser’s analysis of the pertinent facts and
authorities and unambiguously states that the tax adviser
concludes that there is a greater than 50-percent likelihood that
the tax treatment of the item will be upheld if challenged by the
IRS. Sec. 1.6662-4(g)(4)(B), Income Tax Regs. None of the tax
opinions that petitioner purportedly relied upon in preparing
SMP’s and Corona’s partnership tax returns unambiguously state
that there is a greater than 50-percent likelihood that the tax
treatment of the transactions at issue in these cases would be
upheld if challenged by the IRS. Moreover, for the reasons
discussed below, we conclude that Mr. Lerner did not reasonably
rely on those opinions. We conclude that petitioner did not have
substantial authority for his tax treatment of the transactions
at issue.
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