Cirelli v. Commissioner
United States Tax Court
C's five children formed a "partnership" which leased equipment and a yacht to C corporation, a construction contractor. Held, the partnership is a "sham," whether viewed under the sec. 704(e), I.R.C. 1954, regulations or the test in Commissioner v. Culbertson, 337 U.S. 733 (1949). Held, further, the "partnership's" property will be treated, for Federal tax purposes, as being owned by C corporation.
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C's five children formed a "partnership" which leased equipment and a yacht to C corporation, a construction contractor. Held, the partnership is a "sham," whether viewed under the sec. 704(e), I.R.C. 1954, regulations or the test in Commissioner v. Culbertson, 337 U.S. 733 (1949). Held, further, the "partnership's" property will be treated, for Federal tax purposes, as being owned by C corporation. Held, further, expenses relating to the yacht are not deductible, since the yacht was acquired and used for C's personal purposes. Held, further, constructive dividends to C from C corporation…
1Opinion of the Court
Tannenwald, Judge:
Respondent determined the following deficiencies in petitioners’ Federal income taxes:
Petitioners Docket No. Year Deficiency
Joyce Ann Cirelli 14917-82 1973 1974 1975 $129.74 171.44 1.723.54
Lucia Ann Cirelli 14918-82 1973 1974 1975 129.74 320.11 1.546.55
Mary Cirelli 14919-82 1973 1974 1975 129.74 321.00 1.545.14
Jack Leone and Barbara Leone 14963-82 1975 2.387.15
Petitioners Docket No. Year Deficiency
John Cirelli 14991-82 1975 $1,964.60
Charles J. Cirelli 14992-82 1975 25,995.20 and Martha C. Cirelli
Charles J. Cirelli 15244-82 1975 25,087.86 & Son, Inc.
The principal issue for…
2Cases cited30 opinions
- Commissioner v. CulbertsonSupreme Court of the United States · 1949
- Challenge Mfg. Co. v. CommissionerUnited States Tax Court · 1962
- American Properties, Inc. v. CommissionerUnited States Tax Court · 1957
- Foster v. Comm'rUnited States Tax Court · 1983
- Ashby v. CommissionerUnited States Tax Court · 1968
25 more not listed; retrieve them via the Exa API.
3Cited by23 opinions
- Penrod v. CommissionerUnited States Tax Court · 1987
- Elrod v. CommissionerUnited States Tax Court · 1986
- Lewis Arthur Merryman v. Commissioner of Internal Revenue, Michael A. Carroll and Margaret W. Carroll v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1989
- Norman v. CommissionerUnited States Tax Court · 1987
- Tifd Iii-E, Inc. v. United StatesCourt of Appeals for the Second Circuit · 2012
18 more not listed; retrieve them via the Exa API.