River City Ranches #1 Ltd., Jeffry Bergamyer, Tax Matters Partner - Page 3
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petitioners additional discovery limited to whether Walter J.
Hoyt III (Hoyt), then the tax matters partner (TMP), executed
consents to extend the limitations periods while disabled by
conflicts between his own interests and those of his partners,
and for any necessary retrial following such discovery.
Pursuant to the remand, petitioners deposed three present
and/or former employees of the Internal Revenue Service (IRS),
respondent made available to petitioners his entire store of
documents that had not been produced earlier, and the Court held
a second trial.
We must now decide two issues. First,3 in the following
cases, we must make factual findings regarding whether the sheep
partnership transactions were tax-motivated transactions (i.e.,
whether the transactions or the partnerships themselves were
shams and/or whether there were asset overvaluations and basis
overstatements) for purposes of the section 6621(c) penalty-
3Normally, before deciding other issues we would decide
whether the period of limitations on assessment had expired when
respondent issued the notices of final partnership administrative
adjustment (FPAAs). However, the parties agree that the FPAAs
for the partnerships’ 1986 taxable years were timely issued, and
we must decide the sec. 6621(c) penalty-interest issue for that
year in all events. Since findings as to whether the partnership
transactions or the partnerships themselves were shams and/or
whether there were asset overvaluations and basis overstatements
for purposes of the sec. 6621(c) penalty-interest provisions are
factors to be considered in deciding the limitations period
issue, we will decide the sec. 6621(c) issue first.
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Last modified: November 10, 2007