113 T.C. No. 4
UNITED STATES TAX COURT
GERALD A. SADLER, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 1046-98. Filed July 29, 1999.
P, a tax attorney, was the president and sole
shareholder of six corporations. P prepared his own
Forms W-2 for 1989 and 1990 from these corporations.
The Forms W-2 listed large amounts of Federal income
tax withheld. The corporations did not deposit with
the IRS or withhold any Federal income taxes on the
wages earned by P. On his tax returns for 1989 and
1990, P reported the correct tax imposed under subtitle
A; however, P also reported as withholdings the amounts
listed on the false Forms W-2.
Held: P had an "underpayment" of tax for 1989 and
1990. See sec. 6664(a), I.R.C.; sec. 1.6664-2, Income
Tax Regs.
Held, further, P is liable for the fraud penalty
for 1989 and 1990.
Held, further, the periods of limitation on
assessment for 1989 and 1990 did not expire.
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