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Nursery Income
Petitioners have failed to raise any bona fide disputes
about the unreported income for the years in issue, and Mr. Gandy
acknowledges that his expenses were not understated for 1988 or
1989. From the time of the investigation in 1992 through filing
of the petition in 1993 and prior to trial in 1996, petitioners
contended that their expenses were correctly reported on their
tax returns and failed to raise any claim for additional
deductions. At the time of trial, and in their briefs, however,
they assert that they are entitled to additional labor and
transportation expense deductions as follows:
Item 1985 1986 1987
Labor $346,172 $325,229 $123,094
Transportation 24,356 92,178 2,127
$370,528 $417,407 $125,221
These claims are based on their assertions that their profit
percentage for those years, under respondent’s determinations,
exceeded their profits in other years and profits earned by their
competitors. These claims are based on vague estimates by
Mr. Gandy and by competitors that are totally unsupported by
reliable evidence. The claims were neither timely nor detailed
enough to provide respondent with a reasonable opportunity to
investigate their validity. Moreover, to the extent that the
claims are based on payments in cash of expenses for wages, to
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