JT USA LP v. Comm'r
United States Tax Court
R issued a notice of final partnership administrative adjustment (FPAA) to partnership J and its partners without providing a notice under sec. 6223(a), I.R.C. Ps, partners of J other than the tax matters partner, attempted to elect out of the partnership-level proceeding only in their capacity as indirect partners. Held: Section 6223 allows partners holding different partnership interests in the same partnership to make different elections for each interest.
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R issued a notice of final partnership administrative adjustment (FPAA) to partnership J and its partners without providing a notice under sec. 6223(a), I.R.C. Ps, partners of J other than the tax matters partner, attempted to elect out of the partnership-level proceeding only in their capacity as indirect partners. Held: Section 6223 allows partners holding different partnership interests in the same partnership to make different elections for each interest. Ps' election, otherwise conforming to the requirements of sec. 301.6223(e)-2T(c), Proced. & Admin. Regs., is therefore effective. Held,…
1Opinion of the Court
OPINION
Holmes, Judge:
In the 1970s, John Ross Gregory and his wife Rita founded the business which became JT USA, LP. It was very successful in selling accessories to enthusiasts of motocross and paintball. Over 20 years later the Gregorys decided to sell, and were faced with the problem of a large tax on a very large capital gain. Their solution was to use an alleged tax shelter to create losses large enough to offset their gain. The Commissioner has challenged those losses, but the Gregorys think they’ve found a way to keep them, or at least greatly increase the odds of keeping them, because…
2Cases cited4 opinions
- Kligfeld Holdings v. Comm'rUnited States Tax Court · 2007
- Barbados 6, Ltd. v. CommissionerUnited States Tax Court · 1985
- Ginsburg v. Comm'rUnited States Tax Court · 2006
- Adkison v. Comm'rUnited States Tax Court · 2007
3Cited by9 opinions
- JT USA, LP v. CommissionerCourt of Appeals for the Ninth Circuit · 2014
- Raghunathan Sarma v. Commissioner of Internal RevenueCourt of Appeals for the Eleventh Circuit · 2022
- Uniquest Del. LLC v. United StatesDistrict Court, W.D. New York · 2018
- JT USA LP v. Comm'rUnited States Tax Court · 2008
- JT USA, LP v. CommissionerCourt of Appeals for the Ninth Circuit · 2014
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