- 45 - evidence of fraud with regard to these items. See Korecky v. Commissioner, supra at 1568. When petitioners met with their accountants to review their tax returns for the years in issue, they did not mention the gas rebate income even though they were asked whether any items of income had been omitted.32 Petitioners cashed the rebate checks, deposited them into their personal bank accounts, or, in one instance, deposited the check in Towers Construction’s bank account before dividing the proceeds between Briggs and Mrs. Morris. Petitioners’ explanations of their behavior in this regard were implausible and inconsistent. Petitioners kept inadequate records. By Briggs’ own admission, petitioners were “sorry bookkeepers”. Daniell’s accountant testified that the records were “appalling”. The funds of petitioners’ various business entities, and possibly their personal funds as well, were commingled in something called an “intercompany” bank account that apparently was in the name of Briggs.33 Petitioners disregarded corporate formalities in their 32 Briggs testified implausibly that he informed his accountants of the gas rebate payments “indirectly” by giving them a copy of a newspaper article concerning the rebate program. “I gave them a copy of it. And I laughed and joked and said, Here you go. Look at this.” 33 Briggs testified on direct examination that “I didn’t have a personal account. My account was commingled with the (continued...)Page: Previous 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 Next
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