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1 50 percent of the interest due on $2,294,259.
By an amendment to answer, respondent asserts as his primary
position an increase in the determination of deficiency for 1988
and additions to tax for fraud as follows:
Additions to Tax
Sec. Sec. Sec. Sec.
Year Deficiency 6653(b)(1)(A) 6653(b)(1)6653(b)(1)(B) 6654
1987 $2,294,259 $1,720,694 --1 $123,913
1988 110,500 -- $82,875 -- 6,573
1 50 percent of the interest due on $2,294,259.
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. All dollar amounts are rounded to the
nearest dollar, unless otherwise indicated.
The issues for decision are: (1) Whether petitioner had
unreported income of $5,948,020 and $367,360 in 1987 and 1988,
respectively. We hold he did. (2) Whether petitioner is liable
for additions to tax for fraud for 1987 and 1988, or, in the
alternative, whether petitioner is liable for the additions to
tax for failure to file tax returns for 1987 and 1988, and for
negligence. We hold petitioner is liable for the additions to
tax for fraud for 1987 and 1988. (3) Whether petitioner is
liable for self-employment tax of $5,387 and $5,859 in 1987 and
1988, respectively. We hold he is. (4) Whether petitioner is
liable for the additions to tax pursuant to section 6654 for
failure to pay estimated income tax. We hold he is.
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