- 8 - it. In general, petitioner trusted Thomas Dillon and his handling of the family finances. On November 20, 1989, respondent issued a notice of deficiency to petitioner and Thomas Dillon. In the notice of deficiency, respondent disallowed the loss from Supertaps of $77,739 which had been deducted by the Dillons in 1981. Further, respondent determined that the Dillons had failed to report $43,158 of income earned on their Murphy Favre account in 1982. Petitioner and Thomas Dillon entered into nearly identical closing agreements with the Internal Revenue Service concerning the investment in Supertaps. Thomas Dillon's closing agreement contains the same financial terms as petitioner's, except that his agreement does not contain an "innocent spouse" provision. Under the terms of these agreements, petitioner is entitled to losses in connection with Supertaps in the amount of $300,625, which had been previously deducted on the Dillons' 1981, 1982, and 1983 joint Federal income tax returns. Further, under these agreements, there is no Federal income tax deficiency for the taxable years 1982 through 1985 relating to the Supertaps investment. In the event petitioner is not found to be an innocent spouse, then petitioner is liable for a $12,143 deficiency for 1981, and petitioner must also report $114,076 in income from Supertaps on her 1986 Federal income tax return, or on the next open Federal income tax return.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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