Leo N. Levitt and Ruth G. Levitt - Page 52

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          petitioners because Polymer and Chemical Traders had no business            
          purpose, petitioner controlled the Polymer and Chemical Traders             
          bank accounts, and petitioner could and did use those accounts              
          for his benefit.  As discussed above, respondent's determination            
          is presumed to be correct, and petitioners have not proven                  
          otherwise.                                                                  
               6.   Constructive Dividends for 1970                                   
               Respondent determined that petitioners did not report the              
          following income in 1970:  $5,371 from Polymer, $15,600 from                
          Chemical Traders, $4,910 from Factory Expense, and $41,095 from             
          Van Syckle Chemical Plant.  In 1970, petitioners reported $27,300           
          of income without identifying the source.  Petitioners contend              
          that we should reduce any constructive dividend for 1970 by                 
          $27,300 because they reported that amount, which represents their           
          estimate of the value of Chemical Traders and Polymer Chemicals             
          transactions on their 1970 return.  We disagree.  Petitioners did           
          not show how the $27,300 they reported related to any of the                
          amounts respondent determined to be unreported income.  They rely           
          on Goldstein's testimony that it was to cover income adjustments            
          from respondent's audit for 1970.  Goldstein's testimony does not           
          prove respondent's determination to be incorrect because it does            
          not show how the reported income of $27,300 relates to any of               
          respondent's adjustments for 1970.                                          








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