- 7 -
beer, liquor, etc. These monthly summary sheets were furnished
to petitioners’ accountant who prepared Radtam’s corporate tax
returns.8
In addition to the monthly summary sheets, each month
petitioners provided their accountant with corporate bank
statements and a schedule of corporate disbursements. The bank
statements furnished to the accountant reflected two of Radtam’s
accounts at Security Savings & Loan. However, Radtam also
maintained a savings account at Chemical Bank9 from July 1, 1988,
through June 30, 1992. Before 1991, petitioners’ accountant was
not made aware that Radtam had a bank account with Chemical Bank.
Sometime after 1991, and after the Internal Revenue Service (IRS)
began its investigation, petitioners started providing their
accountant with monthly summary sheets listing deposits into the
Chemical Bank account.
Radtam reported gross receipts and taxable income on its
corporate income tax returns as follows:
FYE FYE FYE FYE FYE
6/30/88 6/30/89 6/30/90 6/30/91 6/30/92
Gross Receipts $453,734 $684,395 $868,601 $901,615 $803,517
Taxable Income 118,657 (616) 12,308 (242) 7,331
1Radtam was an S corporation in 1988 that reported this amount as
ordinary income.
8The same accountant prepared petitioners’ individual
Federal income tax returns and the corporate Federal income tax
return for another entity owned by petitioners called Bradam.
9Account No. 600-871255.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011