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Respondent determined that the following payments by Beck's
Liquors were constructive dividends to Mr. Beck:
1991 1992 1993
Condo association fees 1,276 1,014 980
Insurance-condos, vehicles 3,687 1,866 1,830
Diverted corporate income 74,453 115,133 84,782
Credit card--personal expenses 14,095 14,993 16,193
Auto expense/repairs 10,152 7,294 4,679
Miscellaneous -0- 378 254
Advertising/personal ticket use 200 200 200
Condo utilities 1,098 1,398 1,580
Other personal expenses 15,237 5,239 2,221
Property taxes 1,780 1,750 3,296
Annual meeting expenses 1,461 2,183 1,626
Total 123,439 151,448 117,641
As a result of respondent's determination that Mr. Beck
received constructive dividends from Beck's Liquors in each of
the years at issue, respondent determined that Mr. Beck underpaid
his taxes in 1991, 1992, and 1993, respectively, in the amounts
of $28,517.92, $41,509.00, and $30,649.00.
OPINION
Issues 1, 2, & 3: Whether Beck's Liquors Is Liable for the Fraud
Penalty Under Section 6663(a) for Each of the Years at Issue, and
Whether Mr. Beck Is Liable for the Fraud Penalty Under Section
6663(a) for Fraudulently Understating His Income on His 1991
Federal Income Tax Return and Under Section 6651(f) for
Fraudulently Failing To File Federal Income Tax Returns for 1992
and 1993.
Respondent asserts that Beck's Liquors is liable for the
fraud penalty under section 6663(a) for each of the years at
issue, and that Mr. Beck is liable for the fraud penalty under
section 6663(a) for fraudulently understating his income on his
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