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to include the respective amounts of that interest income in
their joint returns for the years 1989 through 1992.
Mr. Daimler and Ms. Mondragon did not disclose the existence
of the TCB account or the German account to the individuals who
prepared their joint returns and Dieter Electronics’ corporate
returns for the taxable years at issue. During the examination
of the joint returns of Mr. Daimler and Ms. Mondragon and the
corporate returns of Dieter Electronics for the taxable years at
issue, Mr. Daimler presented false loan documents to respondent’s
agent. On various occasions, Mr. Daimler has bragged about
diverting cash and checks from Dieter Electronics and using those
funds personally. In addition, on various occasions, Mr. Daimler
has bragged about underreporting both his personal income and the
taxable income of Dieter Electronics by using the income diver-
sion scheme described above.
Respondent issued a notice of deficiency (notice) to Mr.
Daimler and Ms. Mondragon for their taxable years 1989, 1990, and
1991 and a separate notice for their taxable year 1992. In those
notices, respondent determined the following deficiencies in, and
fraud penalties under section 6663 on, their Federal income tax
(tax):
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Last modified: May 25, 2011