Eugene A. Beck, et al. - Page 4




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          Eugene A. Beck                                                              
          docket Nos. 12215-99, 12216-99                                              
                                                  Penalty                             
               Year           Deficiency          Sec. 6663(a)                        
               1991           $28,517.92          $21,388.44                          
               1992           41,509.00           31,131.75                           
               1993           30,649.00           22,986.75                           
          Beck's Village West Liquors, Ltd.                                           
                docket No. 12217-99                                                   
          Penalty                                                                     
          Year         Deficiency          Sec. 6663(a)                               
          1991         $44,274.16           $32,127.00                                
          1992          23,047.49            17,285.62                                
          1993          37,064.66            26,407.50                                
               Unless otherwise indicated, all section references are to              
          the Internal Revenue Code in effect for the years at issue, and             
          all Rule references are to the Tax Court Rules of Practice and              
          Procedure.                                                                  
               The issues for decision are as follows:2                               
               1.  Whether Beck's Village West Liquors, Ltd. (Beck's                  
          Liquors or the corporation) is liable for the fraud penalty under           
          section 6663(a) for each of the years at issue.  We hold that it            


               2Respondent determined that Beck's Liquors overstated its              
          cost of goods sold in the respective amounts of $3,014 and                  
          $11,474 on its 1991 and 1993 Federal corporate income tax returns           
          and understated its cost of goods sold in the amount of $39,004             
          on its 1992 Federal corporate income tax return.  Petitioners do            
          not contest those adjustments.  Additionally, the notices of                
          deficiency contain adjustments to Beck's Liquors deductions for             
          charitable contributions and to Mr. Beck's taxable Social                   
          Security benefits.  These are computational adjustments which               
          will be affected by the outcome of the other issues to be                   
          decided, and we do not separately address them.                             





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