- 32 -
We note initially that, in the Schedules E of the joint
returns that petitioner and Mr. Morris filed for 1988 and 1989,
they reported aggregate income from Accu-Data and Meadows of
$24,929 and $18,987, respectively. Consequently, the funds
derived from certain bank accounts of Accu-Data, Trust 768,
Meadows, and MCIC that were received by or expended on behalf of
petitioner during the years at issue exceeded the amounts of any
income of such entities that were reported in the joint returns
for 1987 and 1988 (excess funds) by $11,775 and $26,080.63,
respectively, and did not exceed the amount of such income
reported in the joint return for 1989. On the instant record, we
find that it was not unreasonable for petitioner not to have
inquired into the source of the funds derived from the bank
accounts of Accu-Data, Trust 768, Meadows, and MCIC that were
received by or expended on behalf of petitioner during 1987,
1988, and 1989 to the extent that the joint returns for those
years included income from those entities.
The question we must now resolve is whether the excess funds
for 1987 and 1988 were significant enough that, under the cir-
cumstances surrounding petitioner, she should have investigated
the source of those funds.24 Based on our examination of the
entire record before us, we find that petitioner had no reason to
believe that (1) the $11,775 of excess funds derived from the
24 We are limiting our inquiry to 1987 and 1988 because there
were no excess funds for 1989.
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