- 13 -
For 1986, 1987, and 1988, Ms. Yue also prepared the Federal
corporate income tax returns of the California corporations.
During respondent’s audit for 1986, 1987, and 1988, and
during the litigation of these cases, petitioner has been unable
to obtain from Mr. Makalintal, who apparently has moved back to
the Philippines, information and records pertaining to the bank
accounts that Mr. Makalintal controlled and the purported sale of
Mr. Makalintal’s 2 million shares of stock in ICPI. Based
largely on petitioner’s inability to provide adequate
information, respondent determined that Mr. Makalintal should be
treated as having received in 1986 the entire $3 million stated
sales price for the ICPI stock and as having no tax basis in the
stock. Thus, respondent treated the entire $3 million stated
sales price as additional net long-term capital gain for 1986.
For 1987 and 1988, apparently based just on bank deposits
analyses of the two bank accounts numbered 01150 and 01206
(limited information with respect to which petitioner was able to
provide to respondent), respondent determined that Mr. Makalintal
and petitioner realized unreported additional income of $690,922
and $969,584, respectively.
Also for 1988, respondent determined that $31,335 was
improperly claimed as a home mortgage interest expense deduction
Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 NextLast modified: May 25, 2011