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believed had previously been unreported by Lakeview. It was
petitioner's belief that Lakeview had failed to report income
from cash sales in those years, due to William's practice of
removing all or most cash from the register and splitting it with
petitioner. The accountant computed a ratio of cash to other
sales for the then-most recent 18-month period, and on the basis
of that ratio computed an estimate of the cash sales that may
have occurred, but were not reported, for the years 1984 through
1990. On the basis of these estimates, the accountant prepared
amended returns for Lakeview that reported additional income in
each of the foregoing years. There are no work papers, corporate
records, or other documentation in the record that support the
accountant's estimates.
In December 1992, Amended U.S. Corporation Income Tax
Returns (Forms 1120X) for Lakeview's 1984, 1985, 1986, 1987, and
1988 taxable years, and amended U.S. Income Tax Returns for an S
Corporation (Forms 1120S) for Lakeview's 1989 and 1990 taxable
years, were prepared and signed by the accountant as return
preparer. The returns were subsequently filed on an unknown
date. The returns reported previously unreported income of
Lakeview totaling $189,098. Petitioner filed Amended U.S.
Individual Income Tax Returns (Forms 1040X) for his 1989 and 1990
taxable years reporting his allocable share of the previously
unreported income reported on Lakeview's amended returns for
those years.
Sometime in December 1992, petitioner caused to be prepared
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