Michael v. Domulewicz and Mary Ann Domulewicz v. Commissioner

129 T.C. No. 3

UNITED STATES TAX COURT MICHAEL V. DOMULEWICZ AND MARY ANN DOMULEWICZ, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 10434-05. Filed August 8, 2007. As part of a Son-of-BOSS transaction designed to create a basis of approximately $29.3 million in publicly traded stock purchased at a relatively minimal cost, P entered into a short sale of U.S. Treasury notes and contributed the proceeds of that sale and the related obligation to a partnership (DIP) in which P was one of three partners. Neither P nor DIP treated the obligation assumed by DIP as a liability…