Colin Kelly and Sharon K. Kaufman - Page 6




                                        - 6 -                                         
               Petitioner’s testimony was that he thought it “probable”               
          that the rounded dollar amounts were not income during the years            
          in which they were received and transferred from the trust                  
          account to another account.  In petitioners’ brief, they argue:             
                    b.  Large Rounded Off Numbers.  Mr. Kaufman has                   
               always contended that bills for work and expenses                      
               already done typically total up to odd dollars and                     
               cents; and that large rounded off amounts (such as                     
               $40,000) are much more likely to be retainers for                      
               future work than they are to be bills for work and                     
               expenses already done.  Paragraph 6 of the petitioners’                
               pre-trial memorandum.  And common sense tells you                      
               that’s true; and that the petitioners’ position is                     
               inherently probable.  And the reason why you would get                 
               three checks from the company to make up the $40,000                   
               amount is that different investors and reinsurers are                  
               responsible for different levels of risk at many of                    
               these companies, so that different (typically                          
               reinsurer) authorizations are required to get money in                 
               excess of a certain level (say, $20,000).                              
               Petitioners further show their tendency to rely on                     
          speculative afterthought in the following passage from their                
          brief:                                                                      
                    51.  The $50,000 Heggen Mistake.  The night before                
               trial, Mr. Kaufman discovered he was been [sic]                        
               mistaken about a $50,000 Heggen item in 1992.  * * *                   
               So he admitted that to the Court.  But it now occurs to                
               the petitioners, after further thought, that this                      
               mistake did not require the $50,000 to be INCOME.                      
               Getting it and putting it into the TRUST account would                 
               mean it still was NOT INCOME, though received.                         
               Respondent had a burden to show that it was EARNED that                
               year as well as received into the trust account.                       
          Petitioner’s uncorroborated testimony is patently unreliable.  We           
          are not persuaded by petitioner’s belated rationalizations and              
          attempts to exclude from taxable income amounts that he received            






Page:  Previous  1  2  3  4  5  6  7  8  Next

Last modified: May 25, 2011