John B. Gainer v. Commissioner of Internal Revenue
Opinion
Opinion
Boochever, J.
The Commissioner of Internal Revenue (Commissioner) appeals from the Tax Court’s decision sustaining the income tax deficiency against John B. Gainer (Gainer) but declining to impose an addition to tax pursuant to section 6659 of the Internal Revenue Code. 26 U.S.C. § 6659 (a). We affirm.
BACKGROUND
The facts are not in dispute. Sometime in late 1981, Gainer purchased a ten percent limited partnership interest in a Food-Source refrigerated controlled atmosphere shipping container from FoodSource Sales Corporation. The total price of the container was $260,000. Gainer paid $26,000 for his interest in the container, $4,500 by check and the balance by executing a promissory note.
The container was designed to preserve perishable agricultural products during shipment. The fair market value of the container was stipulated to be between $52,000 and $60,000, a fraction of the purported selling price. The valuation was based upon an earlier decision of the Tax Court in a related ease, Noonan v. Commissioner, 52 T.C.M. (CCH) 534 (1986), aff'd, Todd v. Commissioner, 862 F.2d 540 (5th Cir.1988).
For the 1981 tax year, Gainer claimed a depreciation deduction and investment tax credit…