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of judgment against petitioner, sentencing petitioner to
community confinement and probation. In addition, the District
Court's Order of Judgment required petitioner to make immediate
restitution to the Internal Revenue Service in the total amount
of $36,276. The restitution amount is based on the Government
witness's testimony of petitioner's tax liability for 1986
through 1988. On or around December 27, 1993, petitioner paid
the ordered restitution in full. The judgment of the District
Court is final.
Subsequently, respondent determined in the notice of
deficiency that petitioner received income in the amounts of
$30,252, $49,324, and $56,638, respectively, for 1986 through
1988. Based on those amounts, respondent's deficiency
determinations for 1986 through 1988 are $10,690, $17,884, and
$19,350, respectively. The total deficiency for all 3 years is
$47,924, an $11,648 difference from the tax liability presented
to the District Court and the District Court's ordered
restitution payment.
The difference in the tax liability calculation submitted to
the District Court and respondent's deficiency determination
stems from respondent's disallowance of certain capital losses
and itemized deductions. These disallowances result in positive
adjustments to the taxable income figures presented to the
District Court.
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