- 3 - Petitioner's shareholders and board of directors met on December 1, 1987. The minutes of that meeting show that petitioner would probably need to plug 38 wells at a cost of between $10,000 and $40,000 per well. The minutes also show that petitioner had begun negotiations to buy oil or gas projects which required initial investments as follows: $130,000 for Kelso; $450,000 for Quail Creek; $375,000 for Boren; and $760,000 for Turkey Creek. The board allocated $1 million to plug wells and acquire new projects. 2. Revenue Agent's Contacts with Petitioner's Representatives Richard Saul (Saul), respondent's revenue agent assigned to this case, worked closely with Leonard Hochheiser (Hochheiser), petitioner's representative. On October 5, 1989, Saul asked Hochheiser for a copy of petitioner's tax returns for 1986 and 1987. Hochheiser gave those returns to Saul on November 10, 1989. On January 3, 1991, Saul asked Hochheiser to agree to extend the time to assess tax for petitioner's 1987 year. Saul received a letter on February 4, 1991, in which Hochheiser declined. On February 6, 1991, Saul met with Hochheiser and discussed petitioner's business generally and the audit. Saul briefly mentioned section 531 as an issue to be considered. He did not ask petitioner's owners or Hochheiser whether petitioner needed to accumulate earnings or had plans to expand. Hochheiser did not say whether petitioner had plans to expand.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011