Leon L. Sicard and Eleanor Sicard - Page 11

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          income reported on his Schedules C in the taxable year that it              
          was received.                                                               
               During the years 1983 through 1987, petitioner reported as             
          income on his Schedules C, in the year that the income was                  
          actually received, amounts paid to him from the partnership for             
          equipment rentals and property he sold to the partnership.  On or           
          about the date petitioner received it, petitioner’s bookkeeper              
          entered the $25,000 in management fees paid to petitioner in 1984           
          in petitioner’s general ledger, as management fees received from            
          the partnership, and petitioner reported the $25,000 as income on           
          Schedule C of petitioners’ Federal income tax return for 1984.              
          With the exception of that $25,000, petitioner did not report as            
          income the management fees accrued by the partnership during the            
          years 1983 through 1986 on petitioners’ Federal income tax                  
          returns for those years or on their 1987 return.  He did,                   
          however, report on his returns the other income reflected in the            
          Forms 1099 issued to him during 1987 and 1988 by the partnership.           
               The management fees accruing pursuant to the compensation              
          arrangement were not reflected in any of the records petitioner             
          provided to his accountant, Clifford Abelson, for the purpose of            
          preparing petitioners’ 1983 through 1986 Federal income tax                 
          returns, and Mr. Abelson was unaware of the accruals during those           
          years.  During 1988, during the preparation of petitioners’ 1987            
          return, Mr. Abelson came across the Forms 1099 issued to                    






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