Lizzie W. Calloway v. Commissioner of IRS

RIPPLE, Circuit Judge:

Albert and Lizzie Calloway seek review of a judgment of the Tax Court sustaining the Commissioner’s determination of a deficiency, an accuracy-related penalty and a penalty for filing a delinquent tax return. For the following reasons, we affirm the judgment of the Tax Court.

I

A. Facts

Albert Calloway worked for IBM for a number of years and acquired IBM stock by exercising his employee stock options. During 2001, Bert Falls, the Calloways’ financial adviser, introduced Mr. Calloway to a program operated by Derivium Capital, LLC (“Derivium”). Under that program, Derivium…