Neonatology Associates, P.A., et al - Page 8




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                  8.  Whether Lakewood is liable for the addition to tax for                           
            failure to file timely determined by respondent under section                              
            6651(a).  We hold it is.                                                                   
                  9.  Whether we should grant respondent’s motion to impose a                          
            $25,000 penalty against each petitioner under section                                      
            6673(a)(1)(B).  We hold we shall not.                                                      
                  Unless otherwise indicated, section references are to the                            
            Internal Revenue Code applicable to the relevant years, Rule                               
            references are to the Tax Court Rules of Practice and Procedure,                           
            and dollar amounts are rounded to the dollar.                                              
                                         FINDINGS OF FACT                                              
            I.  Overview of Petitioners                                                                
                  Neonatology is a professional medical corporation wholly                             
            owned by Ophelia J. Mall, M.D. (Dr. Mall).  Its principal place                            
            of business was in New Jersey when we filed its petition.  Dr.                             
            Mall and her husband, Mr. Mall (collectively, the Malls), resided                          
            in New Jersey when we filed their petition.                                                
                  Neonatology reports its income and expenses for Federal                              
            income tax purposes using the cash receipts and disbursements                              
            method and the calendar year.  It reported the following relevant                          
            amounts on its 1992 and 1993 Federal corporate income tax                                  
            returns:                                                                                   










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