Lloyd E. Dawson, Jr. - Page 26

                                       - 26 -                                         
          reported on their 1988 return.  Petitioner has not shown that Ms.           
          Dawson used the funds exclusively for her own benefit, and it               
          appears to us that the funds were largely expended for the                  
          benefit of petitioner’s family or Ms. Dawson’s relatives.  The              
          record shows that petitioner enjoyed significant benefits, such             
          as expensive remodeling of and furnishings for his home, a boat             
          which was purchased and redecorated at significant cost, and                
          vacations to the Caribbean and Disneyland.  Petitioner has not              
          established that such expenditures were characteristic of his               
          accustomed lifestyle, and we conclude that the benefits they                
          afforded him were unusual for his lifestyle.  With respect to the           
          other factors to be considered, we note that, while petitioner              
          was not deserted by Ms. Dawson, they separated and were divorced            
          in 1990.  Such circumstance, however, does not outweigh the                 
          significant benefit that petitioner received from Ms. Dawson’s              
          embezzlement.  Petitioner also has not established that any                 
          hardships would be visited upon him were he not to be relieved              
          from liability for the deficiency attributable to the omission of           
          the embezzled funds from the 1988 return.                                   
               We find, therefore, that it would not be inequitable to hold           
          petitioner liable for the understatement attributable to the                
          funds embezzled by Ms. Dawson in 1988.                                      
               Based upon the foregoing, we hold that petitioner is jointly           
          and severally liable for the deficiencies in, and additions to,             






Page:  Previous  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  Next

Last modified: May 25, 2011