- 47 -
v. Commissioner, supra; Butler v. Commissioner, 114 T.C. 276, 284
(2000); Flynn v. Commissioner, 93 T.C. 355, 365-366 (1989). (We
shall hereinafter refer to the above factors as the education
factor, the involvement in financial affairs factor, the evasive-
ness and deceit factor, and the lavish or unusual expenditures
factor, respectively.)
We now address whether at the time of signing the 1982 joint
tax return petitioner was aware of the circumstances of the
transactions in which Madison Recycling engaged that resulted in
the understatement in the 1982 joint tax return. See Bokum v.
Commissioner, supra.22 At the time she signed the 1982 joint tax
return, petitioner was not even aware of Mr. Korchak’s Madison
Recycling investment, let alone the circumstances of the transac-
tions in which Madison Recycling engaged that resulted in Madison
Recycling’s erroneously claimed $704,111 loss and erroneously
claimed $7 million basis for investment tax credit purposes and
business energy investment tax credit purposes.23
22See also Hillman v. Commissioner, supra.
23Madison Recycling’s erroneously claimed $704,111 loss and
erroneously claimed $7 million basis for investment tax credit
purposes and business energy investment tax credit purposes, in
turn, resulted in Mr. Korchak’s erroneously reporting in the 1982
joint tax return the claimed $58,089 Madison Recycling loss, the
claimed $577,500 of basis attributable to Madison Recycling for
investment tax credit purposes and business energy investment tax
credit purposes, and the claimed Madison Recycling tax credits of
$114,407.
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