- 6 -
1988 1989 1990
Source
Cash on hand $12,000
Insurance proceeds $5,000
Depreciation 1,819 $11,806 9,099
Gross receipts 10,500 8,767
Sch. E income 30,000
Total sources $13,819 $22,306 $52,866
Application
Sch. C expenses $35,104 $15,803
Net loss, Sch. C $6,319
Purchase motel 50,000
Personal living expense 12,600 12,600 12,600
Purchase truck 21,556
Purchase truck 6,000
Equity motel 5,431 6,457
Marijuana 56,000 92,000
Gift to brother 15,000
Legal fees 5,000
Sch. E expenses 11,922
Cash payment motel 10,050
Total applications $68,919 $136,691 $168,832
Excess of applications
over sources 55,100 114,385 115,966
Respondent determined the deficiencies at issue in this case
based on Roberts' analysis.
C. Trial
Petitioner did not appear at trial or request a continuance,
and no one appeared on his behalf.
At trial, respondent conceded that the $92,000 of marijuana
seized by the DEA in 1990 from the second vehicle should not be
counted as an application of petitioner's funds.2
2 Respondent now contends that for 1990, petitioner is
liable for a deficiency of $7,851 and a penalty for fraud under
sec. 6663 of $5,888.
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