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discussed the subject of the home improvements. Specifically,
the special agent was informed "the Richardsons were aware that
Mr. Paige used corporate funds to improve their property,
although they were not privy to the exact amounts or how those
funds were disbursed". Also, Neilson attempted to categorize the
unreported funds received by petitioner from the sale of PCCL
equipment as either business or investment expenses.
Sometime in the beginning of March 1997, respondent
requested petitioners to extend the period of limitations with
respect to the examination of the individual and corporate income
tax returns. Petitioners did not agree to the extension. On
February 28, 1997, respondent scheduled an appointment with
petitioners for March 17, 1997, to conclude the examination of
petitioners' return. On March 4, 1997, respondent contacted
petitioners' attorney to cancel the March 17, 1997, appointment
based on the belief the statute of limitations was set to expire.
On March 5, 1997, respondent sent petitioners proposed
changes to their 1993 tax return.4 On March 11, 1997, respondent
issued a letter to petitioner notifying him that he was no longer
the subject of a criminal investigation. On March 13, 1997,
respondent issued the respective notices of deficiency. After
petitions and answers were filed, petitioners met with
respondent's appeals officer on several occasions. During these
4 We assume proposed changes were also sent with respect
to PCCL; however, the record does not so indicate.
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