Pinnacle Trading Opportunities, LLC v. Comm'r

This case is calendared for trial at a Special Session of the Court commencing on November 12, 2013, in Atlanta, Georgia.

On April 23, 2013, respondent filed a Motion for Entry of Decision with a proposed Decision attached thereto. Respondent provides through his motion that petitioner, Larry S. Freedman, does not object to the granting of this motion. In addition, no partner, other than petitioner, is a participating partner to this action within the meaning of T.C. Rule 247 (b) in that no other partner has filed an election to intervene or participate. The time within which to file a notice of election to intervene or participate under T.C. Rule 245(a) or (b) has expired. Respondent also provides that all partners of the partnership that meet the interest requirement of I.R.C. § 6226(d) are treated as parties to this action pursuant to I.R.C. § 6226(c) and T.C. Rule 247(a). Respondent intends to assess each party by way of computational adjustment based on the decision once a decision is entered in this case.

Given due consideration to the foregoing, and pursuant to*53 Rule 248(b), Tax Court Rules of Practice and Procedure, it is hereby

ORDERED that respondent's Motion for Entry of Decision, filed April 23, 2013, is granted. It is further

ORDERED that this case is stricken for trial from the Special Session of the Court commencing on November 12, 2013, in Atlanta, Georgia. It is further

ORDERED and DECIDED that the following statement shows the adjustments to the partnership items of Pinnacle Trading Opportunities, LLC ("Pinnacle") for the following taxable years:

It is further

ORDERED AND DECIDED that Pinnacle is disregarded as a partnership for Federal income tax purposes and that all transactions purportedly engaged in by Pinnacle are treated as directly engaged in by the partners of Pinnacle without a profit motive under section 183, I.R.C.

It is determined that a 40 percent gross valuation misstatement penalty under § 6662 (a), (b) (3), (e) and (h), I.R.C., applies to all underpayments*54 of tax related to the misstatement of partnership contributions reported to have been made to Pinnacle.

It is further determined that a 20 percent penalty applies due to negligence or disregard of rules or regulations under I.R.C. § 6662 (a), (b) (1) and (c), I.R.C., and

substantial understatement of income tax under § 6662 (a), (b) (2) and (d), I.R.C., and a substantial valuation misstatement under § 6662(a), (b) (3) and (e), I.R.C., to all underpayments of tax related to the adjustment to partnership items other than those underpayments related to the misstatement of contributions to the partnership.

(Signed) Joseph Robert Goeke

Judge

ENTERED: JUL 11 2013