United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT August 23, 2007
Charles R. Fulbruge III
No. 06-50682 Clerk
TRANSCAPITAL LEASING ASSOCIATES 1990-II, LP;
INTERNATIONAL BANCSHARES CORP.,
a Texas Corporation, and Its Subsidiaries;
IBS SUBSIDIARY CORP., a Delaware Corporation;
INTERNATIONAL BANK OF COMMERCE, a Texas Banking Corporation;
IBC FINANCIAL SERVICES, INC.,
a Texas Corporation, a Partner Other than the Tax Matters Partner
Formerly Known as Bancor Development Company of Laredo,
Plaintiffs-Appellants,
versus
UNITED STATES OF AMERICA,
Defendant-Appellee.
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Appeal from the United States District Court
for the Western District of Texas
No. 5:01-CV-881
_________________________________________
Before JONES, Chief Judge, and REAVLEY and SMITH, Circuit Judges.
PER CURIAM:*
The court has considered appellants’ position in light of the
briefs, the oral argument, and pertinent portions of the record.
We find no reversible error of fact or law and affirm for essen-
tially the reasons stated by the district court. Because the
transaction lacked a genuine business purpose and was economically
insubstantial, it is unnecessary for us to adopt either variant of
the sham-transaction doctrine currently used by the courts of ap-
peals. See Compaq Computer Corp. & Subsidiaries v. Comm’r, 277
F.3d 778, 781-82 (5th Cir. 2001) (noting the competing variants
outlined in Rice’s Toyota World, Inc. v. Comm’r, 752 F.3d 89 (4th
Cir. 1985), and ACM P’Ship v. Comm’r, 157 F.3d 231 (3d Cir. 1998)).
We also express no opinion on the ancillary question whether the
business-purpose analysis of an alleged sham transaction that is a
§ 6221 partnership tax matter focuses on the subjective motivation
of the taxpayer partner or the flow-through partnership entity.
See 26 U.S.C. § 6221.
AFFIRMED.
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be
published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
2