- 14 -
Kenmore reported on Schedule L of each of its tax returns
for its fiscal 1980, 1981, and 1982 a balance on line 18, loans
from stockholders, as shown in table 2.
Table 2
Item 1980 1981 1982
Beginning of year $14,632 $4,481 $113,250
End of year 4,481 113,250 99,771
Net increase or (decrease) (10,151) 108,769 (13,479)
Respondent received Kenmore’s tax returns on the following
dates: Kenmore’s fiscal 1980 tax return on June 1, 1981;
Kenmore’s fiscal 1981 tax return on February 4, 1982; and
Kenmore’s fiscal 1982 tax return at some time after March 4,
1983.
The notice of deficiency in Kenmore’s docket, dated April
13, 1984, was mailed on or about that date, less than 3 years
after Kenmore filed its tax returns for all the years in issue.
Income
In the notice of deficiency respondent determined Kenmore’s
taxable income for its fiscal 1981 and its fiscal 1982 by using
the bank deposits method and an analysis of checks disbursed,
based on at least three sources of information, as follows: (1)
Kenmore’s one-write system, (2) Kenmore‘s bank deposit tickets
and canceled checks, and (3) a box of receipts for cash payments,
which box Kenmore gave to respondent. Tables 3 (fiscal 1981) and
4 (fiscal 1982) show, as to the components of respondent’s
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011