Kearney Partners Fund v. United States, No. 14-14067 (11th Cir. 2015)
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Plaintiffs filed suit challenging the Notices of Final Partnership Administrative Adjustment (FPAAs) the IRS issued disallowing all items they claimed on their partnership returns on the ground that partnerships constituted an abusive tax shelter designed to generate artificial, noneconomic tax losses desired by the taxpayer. The district court upheld the administrative adjustments to the partnerships’ returns and entered judgment for the Government. The court concluded that the district court's Memorandum Opinion and Order correctly resolved these questions; and therefore, the court affirmed on this basis. The district court concluded that the FPAAs properly found that the partnerships lacked economic substance and made adjustments accordingly. However, the FPAAs improperly imposed penalties.
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Case: 14-14067 Date Filed: 10/13/2015 Page: 1 of 34 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT __________________________ No. 14-14067 __________________________ D.C. Docket No. 2:10-cv-00153-RBD-CM KEARNEY PARTNERS FUND, LLC, by and through Lincoln Partners Fund, LLC, Tax Matters Partner, KEARNEY PARTNERS FUND, LLC, by and through Delta Currency Management Company, Tax Matters Partner, NEBRASKA PARTNERS FUND, LLC., LINCOLN PARTNERS FUND, LLC, by and through Bricolage Capital Management Company, Tax Matters Partner, LINCOLN PARTNERS FUND, LLC, by and through Nebraska Partners Fund, LLC, Tax Matters Partner, Plaintiffs - Appellants. versus UNITED STATES OF AMERICA, Defendant - Appellee. Case: 14-14067 Date Filed: 10/13/2015 Page: 2 of 34 __________________________ Appeals from the United States District Court for the Middle District of Florida __________________________ (October 13, 2015) Before TJOFLAT and HULL, Circuit Judges, and BARTLE,∗ District Judge. PER CURIAM: Kearney Partners Fund, LLC, Nebraska Partners Fund, LLC, and Lincoln Partners Fund, LLC brought this action to challenge the Notices of Final Partnership Administrative Adjustment the Internal Revenue Service issued disallowing all items they claimed on their partnership returns on the ground that partnerships constituted an abusive tax shelter designed to generate artificial, noneconomic tax losses desired by the taxpayer. Following a bench trial, the District Court upheld the administrative adjustments to the partnerships’ returns and entered judgment for the Government. The partnerships appeal the judgment, questioning whether the District Court had jurisdiction to determine all partnership and nonpartnership items for the tax periods in question, and, if it had jurisdiction, whether it erred in determining that the transactions at issue lacked economic substance and therefore had to be disregarded for tax purposes. ∗ Honorable Harvey Bartle III, United States District Judge for the Eastern District of Pennsylvania, sitting by designation. 2 Case: 14-14067 Date Filed: 10/13/2015 Page: 3 of 34 The District Court’s Memorandum Opinion and Order, attached hereto as an Appendix, correctly resolved these questions. We therefore affirm the Court’s judgment on the basis of the Memorandum Opinion and Order. 3 Case: 14-14067 Date Filed: 10/13/2015 Page: 4 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 5 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 6 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 7 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 8 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 9 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 10 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 11 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 12 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 13 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 14 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 15 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 16 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 17 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 18 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 19 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 20 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 21 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 22 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 23 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 24 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 25 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 26 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 27 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 28 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 29 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 30 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 31 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 32 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 33 of 34 Case: 14-14067 Date Filed: 10/13/2015 Page: 34 of 34
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