- 41 -
Respondent did not provide any evidence that negates that testi-
mony or that shows that the family expenditures were extraor-
dinary during the years at issue.
We also find it important that although funds of Accu-Data,
Trust 768, Meadows, and MCIC totaling $11,775, $51,009.63, and
$18,144 were received by or expended on behalf of petitioner
during 1987, 1988, and 1989, respectively,32 respondent deter-
mined in the notice that Mr. Morris' unreported embezzlement
income was $70,547 for 1987, $73,185 for 1988, and $43,101 for
1989. In addition, the excess funds which petitioner received
from those entities or from which she benefited totaled only
$11,775 for 1987 and $26,080.63 for 1988, and there were no
excess funds for 1989. On the record before us, we believe that
it would be inequitable to hold petitioner liable for the portion
of the deficiency for each of the years at issue that is attrib-
utable to unreported embezzlement income when that income (1) for
1987 and 1989 substantially exceeds the funds of Accu-Data, Trust
768, Meadows, and MCIC that were expended by or on behalf of
petitioner during each of those years and (2) for 1987 and 1988
substantially exceeds the excess funds that she received or that
were expended on her behalf during each of those years.33
32 Petitioner did not receive or have expended on her behalf any
unreported embezzled funds for 1989.
33 We note that petitioner did not receive or have expended on
her behalf during any year at issue embezzled funds that exceeded
(continued...)
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