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Petitioners submitted a purchase order to the R.V. Center,
Inc., on behalf of the Elknur Family Limited Partnership, for the
purchase of a 1995 Coachman recreational vehicle for $46,0006 on
April 27, 1995. Petitioners caused the 1995 Coachman to be
titled in the name of the Elknur Family Limited Partnership,
although petitioners personally borrowed $32,320 from the Three
Rivers Federal Credit Union and traded in a 1994 Starcraft they
owned. In the loan application with the credit union,
petitioners showed Mr. Runkle’s annual “take home pay” as $37,500
and Mrs. Runkle’s as $30,000. Petitioners provided the credit
union selected information returns (Forms 1099) for 1993 and 1994
regarding income Mr. Runkle received. Petitioners presented no
expense information to the credit union to offset the 1993 and
1994 income reported on the Forms 1099.
Audit Examination
Mr. Runkle received correspondence from respondent during
1991 through 1995 advising him that he had a requirement to file
tax returns. Mr. Runkle testified that he expected respondent to
convince him that his “untaxing” assertions were inaccurate
before he would cooperate with respondent’s examination of 1991
through 1995.
When Revenue Agent Keith Andrews notified Mr. Runkle that
respondent was examining years 1991, 1992, and 1993 and scheduled
6Amounts have been rounded to the nearest dollar.
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