Grossly Inflated Sale Price, Nonrecourse Financing, and Negative Cash Flows Add Up to a Tax Shelter Not Engaged in for Profit

Business Valuation UpdateVol. 10 No. 1
Legal and Court Case Update
January 2004
5063 Electrical Apparatus and Equipment Wiring Supplies, and Construction Materials
423610 Electrical Apparatus and Equipment, Wiring Supplies, and Related Equipment Merchant Wholesalers
federal taxation
income tax

Walford v. Commissioner
T.C. Memo 2003-296, 2003 Tax Ct. Memo LEXIS 299
October 23, 2003
US
Federal Court
United States Tax Court
Michael Jinnette (for taxpayer) <br> Douglas J. Horvey, CPA (for taxpayer) <br> Dr. Mark Rodekohr (for IRS) <br> Ken D. Howell (for IRS)
Goeke

Summary

The issue was whether taxpayer was entitled to an $18,956 deduction related to his limited partnership interest for 1981 and whether he was liable for a valuation overstatement.

See Also

Walford v. Commissioner

The overvaluation of an "emergency management system" resulted in the Commissioner disallowing a deduction made on the basis of the value of that asset. Subsequent sale showed act ...