David W. Stell, Kathleen Stell v. Commissioner of Internal Revenue

999 F.2d 544 NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel. David W. STELL, Kathleen Stell, Petitioners-Appellants, v. COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellees. No. 91-70636. United States Court of Appeals, Ninth Circuit. Submitted Oct. 9, 1992. ** Decided July 23, 1993. Before HUG, FLETCHER and BRUNETTI, Circuit Judge. 1 MEMORANDUM * 2 In 1982, appellants were limited partners in Matrix Business Computers, a partnership whose stated purpose was the development and exploitation of various new technologies. In that same year, appellants claimed income tax deductions under 26 U.S.C. § 174 for a distributive share of the research and experimentation expenses incurred by the partnership. The Commissioner disallowed the deductions, contending that the partnership had not incurred its research expenditures in connection with an existing or prospective business of its own, as required by the statute. See 26 U.S.C. § 174 (a)(1); Snow v. Commissioner, 416…