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return that $57,750 of the claimed $59,835 investment tax credit
was attributable to Madison Recycling and that the claimed
$56,657 business energy investment tax credit was attributable to
Madison Recycling.
With respect to the claimed $58,089 Madison Recycling loss,
we disagree with respondent’s contention that that claimed loss
was large enough to put petitioner on notice that further inquiry
was warranted to determine whether it was proper. As discussed
above, Statement 2 included with the 1982 joint tax return showed
a claimed loss from the Kelly-Brock Drilling Partners 1981-1
partnership that was greater than the claimed $58,089 Madison
Recycling loss and a claimed loss from the Odessey Partners 81
Limited partnership that was approximately equal to the claimed
$58,089 Madison Recycling loss. We have found that the amount of
the claimed $58,089 Madison Recycling loss would not have made
that claimed loss stand out in relationship to the other partner-
ship losses claimed in Statement 2.
Even if, as respondent argues, both the claimed $58,089
Madison Recycling loss and the claimed Madison Recycling credits
of $114,407 had been “clearly set forth in a schedule attached to
the return”, as discussed above, at the time petitioner signed
the 1982 joint tax return she must have had sufficient knowledge
of the circumstances of the transactions in which Madison Recy-
cling engaged that resulted in the understatement in that return
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