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conversations, Maxted informed petitioner that he was having
difficulty selling the car shades. Maxted did not repay
petitioner within 90 days; however, he continued to advise
petitioner that he would repay the advance when the car shades
were sold.
Within the first few months of 1989, petitioner could not
reach Maxted by telephone because the telephone line was
disconnected. A month or two later, petitioner flew to Phoenix
and visited the shop where the car shades were made. Someone at
the shop informed petitioner that Maxted had moved out and was
gone. Petitioner did not continue to call or look for Maxted.
However, he occasionally inquired about Maxted's whereabouts from
Maxted's family in Montana and various acquaintances; however, no
one had any information about him.
Petitioner signed his 1988 Federal income tax return on
February 11, 1992. However, petitioner did not file the return
until August 19, 1992, because of various personal problems.
Petitioner did not apply for an extension to file his 1988
return. On the Schedule D, Capital Gains and Losses, attached to
the return, petitioner reported a nonbusiness bad debt of
$10,000, resulting in a claimed short term capital loss of $3,000
for 1988 and a short term capital loss carryover to 1989 of
$7,000.
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