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1. 1983........................................ 34
2. 1984........................................ 43
3. 1985........................................ 47
4. 1986........................................ 55
E. Financial Statements, Tax Returns, Audits,
Notice of Deficiency......................... 67
F. Interest Expense for 1987...................... 78
OPINION................................................ 80
I. Statute of Limitations.............................. 80
A. Underpayments of Tax........................... 86
(1) 1983....................................... 91
(2) 1984....................................... 100
(3) 1985....................................... 106
(4) 1986....................................... 117
(5) Conclusions................................ 119
B. Fraudulent Intent.............................. 120
(1) Petitioner’s Knowledge of
Credit Card Charges..................... 122
(2) Petitioner’s Knowledge of Payments......... 123
(3) Petitioner’s Knowledge of Berger’s
Limited Role............................ 124
(4) Petitioner’s Knowledge of the Tax Laws..... 125
(5) Petitioner’s Misleading Explanations....... 128
(6) Other Considerations....................... 133
C. Conclusions.................................... 141
II. Additions to Tax.................................. 141
A. Fifty-Percent Fraud Addition--1985............. 141
B. Additional Amount for Portion
Attributable to Fraud--1985.................. 142
C. Fraud Additions--1986.......................... 143
D. Negligence Additions--1986..................... 146
III. Amounts of Deficiencies........................... 147
A. Amount of Constructive Dividends............... 147
B. Interest Deduction............................. 148
IV. Innocent Spouse Relief............................ 152
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Last modified: May 25, 2011