Henry Deletis, Jr. - Page 16

                                       - 16 -                                         
          through embezzlement, misappropriation, and the sale of stolen              
          goods.  James v. United States, 366 U.S. 213 (1961); Norman v.              
          Commissioner, 407 F.2d 1337 (3d Cir. 1969), affg. T.C. Memo.                
          1968-40; Naegle v. Commissioner, 378 F.2d 397 (9th Cir. 1967),              
          affg. T.C. Memo. 1965-212;  Lydon v. Commissioner, 351 F.2d 539             
          (7th Cir. 1965), affg. T.C. Memo. 1964-27; Schira v.                        
          Commissioner, 240 F.2d 672 (6th Cir. 1957), affg. T.C. Memo.                
          1956-35.                                                                    
               Respondent asserts that petitioner has unreported income for           
          the taxable years 1966 and 1967, in the amounts of $37,636.73 and           
          $148,518.66, respectively, from the sales of cars which                     
          petitioner misappropriated from the dealership during those                 
          years.  The record shows that petitioner received at least those            
          net amounts.  Petitioner admits to the existence of the car-sales           
          scheme, but alleges that the purpose of the scheme was to provide           
          funds to allow Caplan to keep the dealership.  Petitioner admits            
          to using $40,000 of the proceeds, but insists that is all he                
          stole.  However, substantial amounts of the proceeds were                   
          deposited into a bank account over which petitioner had sole                
          access and control.                                                         
               The "mere receipt and possession of money does not by itself           
          constitute taxable income."  Lashells' Estate v. Commissioner,              
          208 F.2d 430, 435 (6th Cir. 1953), affg. in part and revg. in               
          part a Memorandum Opinion of this Court.  Where a person collects           
          funds merely as an agent, the funds do not constitute income to             




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011