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Schedule C attached to his return, petitioner stated that he was
an “accountant”, and that his business name was “House
Accountant”. Petitioner failed to provide a complete business
address but stated his office was in Lockport, Illinois.
JJH—Petitioner prepared and filed returns for JJH for the
fiscal years ending June 30, 1994 and 1995, reporting that the
business activity of JJH was “sales” and the product or service
was “process”. For these years, petitioner reported the gross
receipts from his accounting business on JJH’s returns, reporting
gross receipts of $156,197 and $152,340, respectively. These
gross receipts equaled the total deposits into the JJH account
for both years.4 In reporting the total bank deposits as gross
receipts, petitioner was aware he was including transfers from
CCA’s and Coastal’s accounts. In each year, petitioner claimed
on JJH’s return deductions and cost of goods sold in excess of
the gross receipts, and JJH paid no tax in either year. The
claimed deductions and cost of goods sold included the checks
drawn for business and personal items of $150,208 as set forth
above for calendar year 1994.
CCA’s Returns—Petitioner prepared and filed a return on
behalf of CCA for 1994, reporting gross receipts of $66,994,
expenses and cost of goods sold of $68,358, and no taxable
4For the calendar year 1994, the reported gross receipts
equal the $176,547 in deposits identified above.
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