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substantial understatement of tax pursuant to section 6662. The
deficiency primarily relates to Sam E. Scott's (petitioner)
withdrawal from his law firm partnership.
After concessions, the following issues remain for decision:
(1) Whether petitioner was entitled to a $121,500 loss deduction
due to his withdrawal from his law firm partnership; (2) whether
petitioner received an $85,455 taxable distribution from his law
firm's 401(k) plan; (3) whether petitioner is entitled to a $33,943
interest expense deduction; (4) whether petitioner is liable for an
addition to tax for failure to timely file his 1991 Federal income
tax return pursuant to section 6651(a)(1); and (5) whether
petitioner is liable for an accuracy-related penalty for the
substantial understatement of tax pursuant to section 6662.
All section references are to the Internal Revenue Code as in
effect for the year in issue, unless otherwise indicated. All Rule
references are to the Tax Court Rules of Practice and Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. The
stipulation of facts and the attached exhibits are incorporated
herein by this reference.
Petitioner resided in Hazlehurst, Mississippi, at the time he
filed his petition.
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