11
Kane and petitioner both prepared 1985 returns for
petitioners. The return Kane prepared showed that petitioner had
no wages. Petitioner received the return Kane had prepared, and
then prepared and filed a different tax return as petitioners'
joint return. Petitioner reported wages of $87,845 and interest
income of $93,131 on the return he filed for 1985. In 1985,
petitioner bought U.S. Treasury bonds that paid interest of
$79,375. In 1988 and 1989, petitioner included parts of the
returns prepared by Kane in the returns he prepared and filed as
petitioners' joint returns.
On their tax returns for 1990, 1991, and 1992, petitioners
reported gains from the sale of Bohannon, S.A. stock of $219,500
for 1990, $109,500 for 1991, and $218,000 for 1992.
Petitioner gave Kane handwritten notes or oral information
about his basis in the Bohannon, S.A. stock that he reported he
sold on his 1988 return. Petitioner did not give Kane a copy of
contracts of sale or income or expense statements showing that he
had bought or sold Bohannon, S.A. stock. Petitioner gave Kane no
documents relating to the sale of Bohannon, S.A. stock in 1989,
1990, and 1991. Petitioner gave Kane brokerage statements
showing that petitioner sold some publicly traded stocks.
Petitioner gave Kane no Forms W-2 or payroll records
relating to his salary from Bohannon, S.A.
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