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taxable ordinary income of $604,055 on the sale of Woodbine.
Howard and Susan Berger filed a timely application for an
automatic extension of time until August 15, 1990, to file their
1989 Form 1040. They included a $10,000 estimated tax payment
with the application. Howard and Susan Berger filed their 1989
Form 1040 on July 26, 1990.
On Schedule C attached to Howard and Susan Berger's 1989
return, they reported $175,142 of taxable income from the
Woodbine business, based upon a computation of one-half of the
income from before March 14, 1989, for Phase II mausoleum crypt
sales and less than 10 percent of the total Woodbine operating
expenses for 1989.
On July 1, 1991, the Internal Revenue Service issued an
amended report, Form 4549, in connection with the examination of
the 1989 income tax return of Howard and Susan Berger. The
report and respondent's statutory notice took the position that
Howard Berger's Schedule C taxable income from Woodbine during
1989 should be increased by $245,716, without any offset for the
costs allocable thereto. Respondent's amended answer takes the
position that Howard Berger also realized and recognized taxable
income of $604,055 on the sale of Woodbine to the Kunkowskis.
Howard Berger died on April 20, 1994.
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