Raymond Albert Moorefield - Page 7

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          repay that amount.  He simply was trying to protect his                     
          litigating position.  Because he had control over those funds in            
          1988, the $45,000 must also be included in his income for that              
               Petitioner asserts that the funds that were assigned to his            
          children were to compensate them for the loss of their father               
          during the years in which he was engaged in litigation with                 
          Wright.  Petitioner’s anticipatory assignment of the proceeds to            
          his children, however, cannot avoid tax otherwise due on amounts            
          paid on account of his claim against Wright.  See, e.g., Lucas v.           
          Earl, 281 U.S. 111 (1930); Doyle v. Commissioner, 147 F.2d 769              
          (4th Cir. 1945).                                                            
               Petitioner conceded at trial that he did not consult with              
          any tax adviser with respect to his obligation to report the                
          funds that he received in 1988 on a timely filed return for that            
          year.  He has not established reasonable cause for his failure to           
          file a return.  Similarly, he has not proven that his failure to            
          file the return and report the proceeds as income is not due to             
          negligence.  The additions to tax determined by respondent,                 
          therefore, must be sustained.                                               
               We have considered petitioner’s other claims and                       
          contentions, and they do not affect our disposition of the issues           
          in this case.                                                               
                                                  Decision will be entered            
                                             for respondent.                          

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