- 4 -
From Business, reporting $35,344 and $20,984 in gross receipts
for 1993 and 1994, respectively. Upon examination of
petitioners' tax returns, respondent's revenue agent concluded
that, to some extent, petitioner's business was conducted in
cash. Petitioners did not present adequate books or records to
respondent's revenue agent pertaining to the income generated by
petitioner's business. The revenue agent performed a bank
deposits analysis of the tax years in issue to determine
petitioners' income. A summary of the revenue agent's bank
deposits analysis for 1993 and 1994 reflects the following:
1993
Deposits to bank accounts $93,452
Less deposits from known sources 77,315
Total unexplained deposits 116,137
1994
Deposits to bank accounts $72,808
Less deposits from known sources 49,190
Total unexplained deposits 123,618
1 As previously indicated, respondent has made concessions
reducing the amounts of unexplained deposits.
During the initial interview with petitioners'
representative, the revenue agent inquired as to the amount of
cash petitioners had on hand during the years in question.
Petitioners' representative did not provide an answer. The
revenue agent prepared an information document request that again
inquired as to the amount of cash petitioners had on hand.
Petitioners responded that they did not know how much cash they
Page: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011