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Al Zuni of Arizona, Inc.
Addition to Tax Accuracy-Related Penalty
Year Deficiency Sec. 6651(a)(1) Sec. 6662(a)
1989 $274,514 $68,628 $54,903
1990 194,163 48,541 --
1991 142,726 35,682 28,545
1992 290,668 72,667 58,134
Nashat Khalaf
Addition to Tax Accuracy-Related Penalty
Year Deficiency Sec. 6651(a)(1) Sec. 6662(a)
1989 $127,674 $32,041 $25,535
1990 51,682 13,204 10,336
1991 44,038 11,977 8,807
1992 245,164 -- 49,033
After settlement of many issues, the issues for decision
involve the amount of income that is to be charged to petitioner
Al Zuni of Arizona, Inc. (Al Zuni), on transfer of its inventory
of Native American jewelry to Nashat Khalaf (Khalaf), its 100-
percent shareholder, and the amount of capital gain that is to be
charged to Khalaf with regard to receipt from Al Zuni of the
jewelry inventory.
All section 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.
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Last modified: May 25, 2011