LOS ANGELES - The federal tax court judge overseeing the Whitewater Garden and Ironwood black box bond case this week voiced strong concern over an IRS remedy that can penalize bondholders, whom he referred to as "innocent" parties in the proceeding.

In comments both on and off the court record, Judge Julian I. Jacobs has made it clear that he is troubled over a solution that entails having the Internal Revenue Service declare the bonds taxable.

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