- 2 -
Held, further: P failed to substantiate a part of his
basis in Company Y.
Held, further: R's calculation of the interest portion
on the loan from Bank X is sustained.
Held, further: P failed to substantiate $19,975 of
attorney's fees.
Held, further: P is not liable for the accuracy-
related penalty under sec. 6662(a).
David M. Berrett, for petitioners.
William R. Davis, Jr., for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
FAY, Judge: Respondent determined deficiencies in peti-
tioners' Federal income taxes and penalties as follows:
Penalty
Year Deficiency Sec. 66631
1990 $815,589 $611,692
1991 1,069 802
1 Prior to trial, respondent conceded that
no amounts were due to fraud. In her answer to
the petition, respondent asserted an accuracy-
related penalty against petitioners pursuant to
sec. 6662(a).
All section references are to the Internal Revenue Code in
effect for the taxable years in issue, and all Rule references
are to the Tax Court Rules of Practice and Procedure, unless
otherwise indicated.
A trial was held to resolve the following issues for
decision:
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