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daughter. Mr. Rowe testified that petitioner did not expend
money lavishly. Petitioner testified that the only trip the
family went on contemporaneous to the years in issue was a 1986
trip to Hawaii, and the testimony indicates that the trip was
inexpensive and not lavish.32
Although the purchase price of the Albritton property and
construction of a residence at that location exceeded $1 million,
the inside of the residence was sparsely furnished with old
office furniture from Mr. Rowe’s business, and the walls were
decorated with arts and crafts which were handmade by petitioner.
As a result of Mr. Rowe’s criminal activities, petitioner had to
move out of the Albritton residence and back to Kingsport,
Tennessee, to live with her parents because she was destitute and
had no funds to provide a home for herself.33
Despite the fact that Mr. Rowe was earning substantial
amounts of income during the years in issue, in 1989 and 1990
only $26,176 and $7,086,34 respectively, were deposited into the
32Joseph Shirah, who accompanied petitioners on the Hawaii
trip, testified that the plane tickets for the trip were at a
discount rate and “it was a very inexpensive trip.”
33Respondent determined that petitioners had unreported
income of $283,928, $29,924, $94,648, and $82,053, respectively
for the years 1987 through 1990. This unreported income was
attributable solely to Mr. Rowe, and respondent concedes that
petitioner is not liable for any deficiency associated with this
unreported income for the years in issue.
34Of this deposit total, approximately $4,102, represented
(continued...)
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