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Individual Income Tax Return, using the filing status of "Married
filing joint return".
Mr. Beecroft is a production designer. Petitioners' Form
1040 reports that Mr. Beecroft received $207,559 of wages during
1993 from the following payees:
EP Production Services.................$94,066
Time Warner Entertainment.............. 1,549
First Premiere Co...................... 70,425
The BonBon Picture Co.................. 41,519
Total 207,559
Respondent determined that petitioners failed to report $21,025
of wages paid to Mr. Beecroft in 1993 by EP Management Services,
Inc. EP Management Services, Inc., issued Mr. Beecroft a 1993
Form W-2, Wage and Tax Statement, for these wages. Petitioners
claim that they did not report these wages because they did not
receive this Form W-2, and they believed that any wages Mr.
Beecroft received from EP Management Services, Inc., were
included in a Form W-2 that he received from EP Production Co.2
The notice of deficiency states that "We have adjusted your gross
wages to agree with the amounts shown on Forms W-2."
Petitioners' 1993 Form 1040 also reports a deduction for a
$24,661 loss from Mr. Beecroft's sole-proprietor business (the
Business). The Business provided services on production design,
2 Petitioners received pay stubs for the respective checks
tendered to Mr. Beecroft from EP Production Services and EP
Management Services, Inc., and petitioners now concede that the
Form W-2 from EP Production Services did not list wages and
withholding credits attributable to EP Management Services, Inc.
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