Franklin and Janetta Hubbart - Page 2

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          review of respondent’s determination.  The issue for decision is            
          whether respondent abused his discretion in sustaining the                  
          proposed collection action.2                                                
                                  FINDINGS OF FACT                                    
               Some of the facts have been stipulated and are so found.               
          The first, second, third, fourth, and fifth stipulations of fact            
          and the attached exhibits are incorporated herein by this                   
          reference.3                                                                 


               1(...continued)                                                        
          the Internal Revenue Code, as amended, and all Rule references              
          are to the Tax Court Rules of Practice and Procedure.  Amounts              
          are rounded to the nearest dollar.                                          
               2  Petitioners also dispute respondent’s determination that            
          they are liable for the increased rate of interest on tax-                  
          motivated transactions under sec. 6621(c), I.R.C. 1986.  As to              
          this dispute, the parties filed a stipulation to be bound by the            
          Court’s determination in Ertz v. Commissioner, T.C. Memo. 2007-             
          15, which involves a similar issue.                                         
               3  Respondent reserved relevancy objections to many of the             
          exhibits attached to the stipulations of fact.  Fed. R. Evid. 402           
          provides the general rule that all relevant evidence is                     
          admissible, while evidence which is not relevant is not                     
          admissible.  Fed. R. Evid. 401 defines relevant evidence as                 
          “evidence having any tendency to make the existence of any fact             
          that is of consequence to the determination of the action more              
          probable or less probable than it would be without the evidence.”           
          While the relevance of some exhibits is certainly limited, we               
          find that the exhibits meet the threshold definition of relevant            
          evidence and are admissible.  The Court will give the exhibits              
          only such consideration as is warranted by their pertinence to              
          the Court’s analysis of petitioners’ case.                                  
               Respondent also objected to many of the exhibits on the                
          basis of hearsay.  Even if we were to receive those exhibits into           
          evidence, they would have no impact on our findings of fact or on           
          the outcome of this case.                                                   




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