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Additions to Tax
Year Deficiency Sec. 6653(b)(1) Sec. 6653(b)(2) Sec. 6661
1983 $148,421 $74,211 50% of the $37,105
interest due
on $148,421
1985 105,160 52,580 50% of the
interest due
on $105,160 26,290
All section references are to the Internal Revenue Code as
in effect during the years in issue.
After concessions, the issues for decision are:
(1) Whether Mr. London's deposition in a prior proceeding
is admissible in evidence on the ground that he is
unavailable as a witness within the meaning of rule 804(a)
of the Federal Rules of Evidence due to his refusal to
answer any of the questions put to him on Fifth Amendment
grounds; (2) whether the tapes and transcripts from the
electronic surveillance conducted at Mr. London's business
and the evidence derived therefrom are admissible in
evidence; (3) whether petitioners failed to report income
in 1983 and 1985, as determined by respondent using the net
worth method of reconstructing income; (4) whether
petitioners are liable for additions to tax for fraud under
section 6653(b)(1) and (2) for 1983 and 1985; (5) whether
petitioners are liable for additions to tax for substantial
understatement of liability under section 6661(a) for 1983
and 1985; (6) whether Mrs. London intended to file a joint
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Last modified: May 25, 2011