13 the safe, and that the money in the safe came from savings from his years of working for IBM and inheritances from his father. On March 29, 1994, petitioner-husband gave Davis a revised estimate of the amount of his cash which included the proceeds from the sale of petitioners' assets in Brazil. Davis did a bank deposits analysis to estimate petitioners' income for 1990 and 1991. She examined petitioners' bank accounts. She sought to exclude from her analysis sources of income which she thought were nontaxable, including transfers between accounts, expense reimbursements, and offsetting wire transfers. She apparently did not believe that petitioners had a significant amount of money in Brazil as of December 31, 1989. Petitioners deposited $136,408 in nine bank accounts in 1990. They reported that they had received $23,574 of that amount as Schedule C gross receipts on their 1990 return. Respondent subtracted $23,574 and gross receipts of $4,900 allocated to petitioner-wife, and determined that petitioners had understated their taxable income for 1990 by $107,934. Petitioners deposited $396,905 in eight bank accounts in 1991, $147,426 of which they reported on their 1991 return as Schedule C gross receipts. Respondent determined that petitioners had understated their taxable income for 1991 by $249,479 ($396,905 - $147,426).Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
Last modified: May 25, 2011