- 2 - Respondent determined a deficiency of $11,026 in petitioner’s Federal income tax for 2002. Respondent also determined an accuracy-related penalty under section 6662(a) and (b)(1) and (2) of $2,205.20. The issues for decision are whether petitioner’s $35,000 payment to his former wife was alimony, deductible under section 71(b), and whether petitioner is liable for the penalty for negligence or substantial understatement of tax. Background Some of the facts have been stipulated, and the stipulated facts are incorporated in our findings by this reference. Petitioner resided in Knoxville, Tennessee, at the time that he filed his petition. On August 19, 2002, petitioner and his then wife, Pamela Moritz Tulay (Tulay), met with their respective attorneys to negotiate the terms of their divorce after failed attempts at mediation. At the time of the August 19 meeting, petitioner was represented by William A. Mynatt (Mynatt), and Tulay was represented by Wanda G. Sobieski (Sobieski). Tulay had previously been represented by different counsel in the divorce proceedings. A court reporter was present at the August 19 meeting and prepared a transcript. At the end of the meeting, Sobieski read into the record the understanding that the parties had reached as follows: Petitioner would pay $3,900 a month inPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
Last modified: May 25, 2011