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Petitioner owned a condominium located at 410 N. Market
Street, Apt. 17, Inglewood, California 90302. She alleged she
operated CWC from that condominium.
During 1994, petitioner did not maintain a roster, syllabus,
or any other documentation, to show who the students were who
were purported clients of CWC. There was no documentation for
the lessons that were allegedly taught to them. During 1994,
petitioner did not maintain a log, or other documentation, of any
hours she spent on CWC.
Petitioner did not obtain a business license for CWC. She
did not maintain any business books and records for CWC.
Petitioner did not maintain a separate business checking account
for CWC. She did not advertise the services available through
CWC.
Petitioner reported gross receipts and losses for CWC on her
Federal individual income tax returns for the tax years 1993
through 1996 as follows:
Gross Receipts
Tax Year Reported Loss Claimed
1993 -0- $13,150
1994 -0- 30,684
1995 -0- 24,359
1996 -0- 16,291
Petitioner did not charge her alleged students because she
said they could not afford to pay. When asked when she could
make a profit, petitioner answered: “I expected to make a profit
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Last modified: May 25, 2011