- 46 -
taxable years from 1989 through 1993, and Ms. Johnson received
zero, $9,000, $16,900, $15,500, and $13,000 during the same
respective years.
Johnson Roofing, Inc. (Roofing) is an affiliate of Systems.
Roofing's relevant tax returns included the following
information:
Taxable year ended 10/31/89 10/31/9010/31/91 10/31/92
Total income $1,865,045 $1,939,495$1,582,097 $1,893,945
Compensation of officers233,988 300,600 10,200 - 0 -
Salaries & wages 50,495 429,644 535,298 603,235
Pension, profit-sharing, plans - 0 -- 0 - - 0 - - 0 -
Employee benefit programs1,087 - 0 - - 0 - - 0 -
Taxable income (loss)114,719 123,189(197,520) (471,113)
Of the reported compensation, Mr. Johnson received $73,000,
$234,988, and $288,000 in his respective taxable years from 1988
through 1990. Ms. Johnson received $20,580, $31,200, and $15,600
during the same respective years. Neither of the Johnsons
received any compensation from Roofing during their 1991 through
1993 taxable years.
The Johnsons filed timely their joint 1990 Federal income
tax return. On March 3, 1994, the Commissioner mailed them a
notice of deficiency reflecting a determination that the
Johnsons' 1990 taxable income was increased by $297,299 on
account of a taxable transfer of property from Systems under
section 83.12 The notice also stated that the Johnsons were
liable for a $16,794 accuracy-related penalty under section
12 The notice also increased the Johnsons' 1990 income by
$184,099 on account of "Agreed Items".
Page: Previous 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 NextLast modified: May 25, 2011