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Accuracy-Related Penalty
Year Deficiency Sec. 6662(a)
1988 $ 1,351 ---
1989 19,046 $3,809
1990 16,430 3,286
1991 16,436 3,287
Pursuant to an amended answer, filed October 10, 1995, respondent
seeks a $9,864 increase in the deficiency for 1988, so that the
total amended amount of the proposed deficiency for that year is
$11,215.
Following concessions by petitioners, the issues for decision
are:
(1) The proper characterization (loans, as contended by
petitioners, or wages, as contended by respondent) of monthly
payments received by petitioner Mark D. Morgan from Robert Randall
Co. We hold that such payments are wages, includable in
petitioners' income.
(2) Whether petitioners are entitled to claimed employee
business expense deductions (for 1989, 1990, and 1991) for
automobile expenses. Because of petitioners' failure to provide
sufficient substantiation, we hold they are not.
(3) Whether the increased deficiency asserted by respondent
for 1988 is time-barred. We hold that it is not.
(4) Whether petitioners are liable for the accuracy-related
penalty under section 6662(a) for 1989, 1990, and 1991. We hold
they are.
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Last modified: May 25, 2011