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Additions to Tax
Year Deficiency Sec. 6651(a)(1) Sec. 6654
1990 $63,547 $15,887 $4,185
1991 65,221 16,305 3,749
1992 25,949 6,487 1,133
1993 22,724 5,681 952
1994 12,113 3,028 623
1995 10,065 2,516 550
After concessions,1 the sole issue for our decision is whether we
should grant respondent’s motion to impose a penalty pursuant to
section 6673.2 We combine our findings of fact with our opinion.
Background
At the time the petition was filed, petitioner resided in
Columbia, South Carolina.
Petitioner failed to file tax returns for 1990 through 1995.
On July 30, 1998, respondent issued a notice of deficiency (the
notice) for these years. The deficiency was principally
attributable to unreported income from petitioner’s sole
proprietorship known as Interstate Safety. Respondent based his
determination of gross receipts on State sales tax returns filed
by petitioner and computed petitioner’s cost of goods sold based
on information obtained from petitioner’s primary supplier.
1 After the majority of the petition and the entire amended
petition were stricken, see discussion infra, the only issue
raised in the petition was whether petitioner had a capital gain
of $6,971 in 1994. In his trial memorandum and at trial,
respondent conceded that petitioner did not have any capital
gains in 1994.
2 All section references are to the Internal Revenue Code
in effect for the taxable years in issue.
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Last modified: May 25, 2011