- 69 -
142(a); see also Am. Ideal Cleaning Co. v. Commissioner, 30 B.T.A.
529, 531 (1934); Burnett v. Commissioner, T.C. Memo. 2002-181,
affd. 67 Fed. Appx. 248 (5th Cir. 2003).
Respondent argues, on the evidence in the record, that "the
allegedly donated goodwill had no value to SMF." Therefore, the
values petitioners claimed as the bases for their section 170
deductions "were 400 percent or more of the correct value, zero."
Respondent further argues that petitioners may not rely upon the
"reasonable cause", "good faith" exception of section 6664(c)(1)
because: (1) The valuation of their intangible assets transferred
to SMF was not "based on a qualified appraisal made by a qualified
appraiser" as required by section 6664(c)(2)(A), and (2)
petitioners failed to make "a good faith investigation of the
value of the contributed property" as required by section
6664(c)(2)(B). See also sec. 1.6664-4(h), Income Tax Regs.41
Petitioners argue that the advice received from Mr. Grant and his
partners and, for several of petitioners, from their own
accountants furnished a "reasonable basis" for their charitable
contribution deductions and that the seeking of and reliance upon
that advice constituted a "good faith investigation of the value
of the contributed property" within the meaning of section
6664(c)(2)(B).
41 As applicable in 1994, the regulation was codified as
1.6664-4(e), Income Tax Regs.
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