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David J. Wood, for petitioners.
Michael F. O'Donnell, for respondent.
GERBER, Judge: Respondent determined deficiencies in
petitioners' Federal income tax and a section 66621 accuracy-
related penalty as follows:
Year Deficiency Sec. 6662 Penalty
1990 $17,451.36 ---
1991 35,394.65 $7,079
After concessions, the issue for our consideration is
whether petitioner Steven R. Williams received taxable
distributions of $264,078 from Maverick Transportation, Inc., an
S corporation, in 1990. Respondent has conceded that petitioners
are not liable for the section 6662 accuracy-related penalty for
1991.2
1 Unless otherwise indicated, all section and subchapter
references are to the Internal Revenue Code in effect for the
years in issue, and all Rule references are to the Tax Court
Rules of Practice and Procedure.
2 The parties have also stipulated that petitioners are
entitled to depreciation deductions of $8,648 for 1991 in
addition to the amount claimed on petitioners' 1991 tax return.
The amount of petitioners' deficiency for 1991 is also affected
by a settlement entered into between Maverick Transportation,
Inc. (MTI), and respondent in a related case, Maverick Transp.,
Inc. v. Commissioner, docket No. 18322-95. In the notice of
deficiency to MTI, respondent determined that MTI was subject to
a built-in gains tax under sec. 1374 in the amount of $104,362
for 1991. In the notice of deficiency issued to petitioners,
respondent allowed petitioners a $104,362 passthrough deduction
in 1991 for MTI's built-in gains tax liability. In the
settlement in Maverick Transp., Inc. v. Commissioner, supra, for
which the Court has entered a decision document, the parties
agreed that MTI is liable for a built-in gains tax in 1991 of
$20,872, which reduces petitioners' 1991 passthrough deduction
allowed by respondent from $104,362 to $20,872.
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