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1984, 1985, 1986, and 1987. We hold they are for the years for
which the understatement is substantial.
5. Whether Reaves Livestock is liable for the additions to
tax for fraud under section 6653(b)(1) and (2) for 1984 and 1985
and section 6653(b)(1)(A) and (B) for 1986 and 1987. We hold
that it is to the extent stated below.
6. Whether Linda L. Reaves qualifies as an innocent spouse
under section 6013(e). We hold that she does not.
Unless otherwise indicated, section references are to the
Internal Revenue Code. Rule references are to the Tax Court
Rules of Practice and Procedure.
FINDINGS OF FACT
A. Petitioners
1. Mr. and Mrs. Reaves
Mr. and Mrs. Reaves are married and lived in Rowland, North
Carolina, when they filed the petition in this case.
Mr. Reaves has an eighth grade education. In 1971, he
formed Reaves Livestock, a North Carolina corporation, the
principal place of business of which is in Rowland, North
Carolina. Mr. Reaves has been the president and sole shareholder
of Reaves Livestock since 1971. Mr. Reaves has no experience or
formal training in bookkeeping or tax matters.
Mrs. Reaves graduated from high school and attended business
school for 3 months. She had no formal training in bookkeeping
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