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Schedule C for the
Wages, Roofing Business
Salaries, Business Reported
Year and Tips Gross Receipts Expenses Income
1993 $10,905 – – $10,905
1994* 1,400 $21,729 $22,707 10,422
1995 1,535 52,359 26,763 10,193**
* For 1994, on a Schedule C-EZ relating to a separate
contracting business, Richard Adair reported $10,000 as
construction gross receipts with no expenses reported.
** For 1995, total reported income includes $19 of
interest income.
On petitioners’ Schedule C, for the roofing business for
1994, petitioners listed Rebecca Adair as owner of the roofing
business. On petitioners’ Schedule C for the roofing business
for 1995, petitioners listed Richard Adair as owner of the
roofing business.
During respondent’s audit, petitioners did not cooperate
with respondent’s agents, and petitioners did not provide to
respondent’s agents the books and records relating to the roofing
business. Also, petitioners mailed to respondent letters
reflecting frivolous tax protester arguments.
On audit and in the notices of deficiency for the years in
issue, using the bank deposits method of proof and the specific
item method of proof for interest income earned on the checking
account balance, respondent determined that petitioners received
unreported taxable income in the following total amounts:
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Last modified: May 25, 2011