- 2 - Taxable Year Additions to Tax Penalty Ended Sec. Sec. Sec. August 31 Deficiencies 6651(a)(1) 6653(a) 6662 1989 $656 $164 $6,615 --- 1990 20,000 5,000 --- $4,000 1991 36,133 9,033 --- 7,227 Following concessions, we must decide: 1. Whether petitioner’s payments to an escrow account (the Fund) are deductible as ordinary and necessary business expenses. We hold they are not. 2. Whether petitioner’s payments to its sole shareholder are deductible as interest. We hold they are not. 3. Whether petitioner is liable for the additions to tax for delinquency determined by respondent under section 6651(a)(1). We hold it is. 4. Whether petitioner is liable for the addition to tax for negligence or intentional disregard of rules or regulations determined by respondent under section 6653(a). We hold it is. 5. Whether petitioner is liable for the accuracy-related penalties for negligence or intentional disregard of rules or regulations determined by respondent under section 6662. We hold it is. Unless otherwise stated, section references are to the Internal Revenue Code in effect for the years in issue. Rule references are to the Tax Court Rules of Practice and Procedure. Dollar amounts are rounded to the nearest dollar. We refer to Harry V. Mohney as Mr. Mohney. We refer to petitioner’s taxablePage: 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