- 21 -
of Alice Berger, an application for an automatic extension of
time, until August 15, 1990, to file her 1989 income tax return,
and for an additional extension until October 15, 1990. The
explanation of why the additional extension was needed states:
"1988 return is under audit and changes may affect 1989". The
District Director approved the application for additional
extension about August 20, 1990. Alice Berger made no estimated
tax payments with her applications for extensions to file her
1989 return. Alice Berger mailed her 1989 income tax return
(Form 1040) on October 12, 1990, and it was received by the
Service Center on October 17, 1990.
Schedule C attached to Alice Berger's 1989 income tax return
reported a net loss from Woodbine of $4,101, having included
slightly less than one-half of Woodbine's gross income and almost
all of its expenses for 1989. Attached to the return was the
following statement:
Schedule C was originally prepared by Daniel Hochberg,
accountant for Woodbine Cemetery. In 1989 the 1988
Federal income tax return of Howard and Alice Berger
was audited and accordingly, an adjustment to income
was made for an additional $229,396. This item
represented deferred income that was being book [sic]
for future years. Therefore upon receipt of the RAR,
this adjustment was made on the 1989 Federal tax
return.
Alice Berger reported the 1989 sale of Woodbine, using Form
6252 for the installment method, on her 1989 income tax return.
She reported the sale price of $680,000 but claimed that the
adjusted basis was $680,000, resulting in no reported gain or
Page: Previous 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 NextLast modified: May 25, 2011