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Respondent determined deficiencies in petitioners' Federal
income taxes and accuracy-related penalties as follows:
Years Deficiencies Sec. 6662(a) Penalties
1992 $1,905 $381
1993 3,570 714
1994 2,029 406
The issues are: (1) Whether petitioners' antique glassware
sales activity was engaged in for profit within the meaning of
section 183, and (2) whether petitioners are liable for the
accuracy-related penalties pursuant to section 6662(a).
Background
Petitioners resided in Littleton, Colorado, at the time they
filed their petition. The facts may be summarized as follows.
Petitioner Betty M. Holowinski obtained a high school degree
and attended 2 years of college where she studied political
science. Petitioner B. Albert Holowinski served in the United
States military for many years and, after his military
retirement, worked in the aerospace industry. During his
military service he obtained a bachelor's degree in business and
a master's degree in urban affairs.
In 1992, both petitioners had retired. Early that year,
Mrs. Holowinski became interested in buying and selling Victorian
glassware. She thought they could make money and that they would
have fun traveling around to various antique shops and flea
markets looking for the glass. To gain some background knowledge
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