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provided him with the money to purchase the house. When he was
asked how his grandmother managed to accumulate $50,220 in cash,
Mr. Ras was unable to provide an answer. When he was asked who
issued the checks for the remainder of the purchase price, Mr.
Ras could not provide a definite answer, nor could he deny that
Mr. Bacon provided him with some of the checks. When he was
asked why he signed a $64,000 mortgage in favor of Mrs. Bacon if
she had not lent him the money, Mr. Ras said that Mr. Bacon told
him to sign and that he would sign anything that Mr. Bacon gave
him.
We do not find Mr. Ras’ explanation to be credible. On the
basis of the facts, we find that petitioners provided Mr. Ras
with $64,000 and that he in turn executed a mortgage on the house
in the amount of $64,000.
C. Real Estate Deposits
Petitioners argue that respondent should reduce their
unreported taxable income under the bank deposit analysis by
$9,000 for 1988 and $4,000 for 1990. According to petitioners,
they issued checks totaling $13,000 to make deposits on
unconsummated real estate transactions. This resulted, according
to petitioners, in the return of $13,000 of nontaxable funds that
were either redeposited or cashed.
Petitioners have not established that these transactions
ever took place or that the amounts in question were returned to
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