- 51 -
petitioners' income from Design Consultants and/or White Star for
1986 and 1988 would still have been understated. We have found
that those written materials did not reflect all of the receipts
of Design Consultants and/or White Star in that (1) the cash
receipts journals omitted, inter alia, all of the amounts that
Design Consultants and/or White Star received from Greyhound
during 1986 and most of the amounts that Design Consultants
and/or White Star received from Mayflower during the years at
issue and (2) the invoice logs16 did not reflect any receipts
from Greyhound and/or Mayflower.
Moreover, even assuming arguendo that, in connection with
Mr. Dennett's preparation of their returns for the years at
issue, petitioners had provided him with the cash receipts
journals and the invoice logs, their rental income for 1986 and
1988 would still have been understated. We have found that
petitioners understated their rental income in each of the
returns at issue. Petitioners do not claim that their rental
income was reflected in the cash receipts journals, the invoice
logs, or any other written records, and it appears that none of
their rental income was reflected in any such records. Conse-
quently, Mr. Dennett must have obtained information regarding
16 The original invoice logs for the years at issue are not part
of the record. Ms. Olbres claimed at trial that she did not know
where they were. Ms. Olbres periodically destroyed the copies of
portions of the invoice logs for the years at issue that she had
brought to petitioners' house.
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