Helen M. Korchak - Page 18

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          11 Current year business energy investment credit - Add lines               
          7 through 10[12] . . . . . . . . . . . . . . . . . . . . . .   57,750       
                    *       *       *       *       *       *       *                 
          14 Tentative business energy investment credit - Add lines                  
          11 through 13.[13]  Enter here and on line 25 of Form                       
          3468 . . . . . . . . . . . . . . . . . . . . . . . . . . .    57,750        
               The following appeared on the bottom of Schedule B of Form             
          3468:                                                                       
               TYPE OF PROPERTY    3-YEAR     OTHER     NONRECOVERY                   
               C - RECYCLING                  577,500.                                
               It was not obvious from reviewing Form 3468 (1) that $57,750           
          of the $59,835 investment tax credit shown in Form 3468, “Part              
          III. - Tentative Regular Investment Credit”, was attributable to            
          Madison Recycling and (2) that the $56,657 business energy                  
          investment tax credit shown in Schedule B of Form 3468                      
          was attributable to Madison Recycling.  (For convenience, we                
          shall sometimes refer collectively to the claimed $57,750 invest-           
          ment tax credit attributable to Madison Recycling and the claimed           
          $56,657 business energy investment tax credit attributable to               
          Madison Recycling as the claimed Madison Recycling tax credits of           
          $114,407.)                                                                  
               Prior to the preparation of the 1982 joint tax return, Mr.             
          Korchak never sought or received any tax advice from Mr. Sokol              


               12No entries were made on lines 8 through 10 of Schedule B             
          of Form 3468.                                                               
               13No entries were made on lines 12 and 13 of Schedule B of             
          Form 3468.                                                                  



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