- 9 - During the subsequent examination of petitioner’s 1993 and 1994 returns, petitioner’s income was reconstructed using a bank deposits and cash expenditures analysis. Through this method it was determined that ARF had gross sales in 1993 and 1994 of at least $573,673 and $1,020,504, respectively. These adjustments resulted in increases of $17,173 for 1993 and $213,892 for 1994 in the income reported by petitioner. Respondent additionally determined that petitioner failed to include an ending inventory of $135,415 in calculating his cost of goods sold for 1993 and received unreported rental income in the amounts of $6,465 and $4,475, respectively, for the years at issue. With other expense disallowances and computational adjustments, it was determined that petitioner underreported his taxable income by $166,681 for 1993 and by $218,285 for 1994. OPINION I. Income Tax Deficiencies Dismissal is governed by Rule 123(b), which provides in relevant part: For failure of a petitioner properly to prosecute or to comply with these Rules or any order of the Court or for other cause which the Court deems sufficient, the Court may dismiss a case at any time and enter a decision against the petitioner. The Court may, for similar reasons, decide against any party any issue as to which such party has the burden of proof, and such decision shall be treated as a dismissal * * *. The granting of a dismissal under Rule 123(b) lies within the discretion of the trial court and requires us to balancePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011