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2. Whether $149,200 seized from petitioners’ home on March
19, 1998, is petitioners’ taxable income from a fencing operation
for 1997. We hold that petitioner Larry Dean Sykes had a
nontaxable cash hoard of $40,000 on December 31, 1996, and that
$109,200 of the $149,200 is taxable income for 1997.
3. Whether petitioners are liable for the accuracy-related
penalty imposed by section 6662(a) for 1997. We hold that they
are.
References to petitioner are to Larry Dean Sykes.
References to Mrs. Sykes are to petitioner Ruby Sykes. Section
references are to the Internal Revenue Code in effect during the
year in issue, and Rule references are to the Tax Court Rules of
Practice and Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
A. Petitioners
Petitioners are married and lived in Ozark County, Missouri,
when they filed the petition in this case.
Petitioner’s father abandoned his family when petitioner was
young. Petitioner’s mother was disabled. His maternal
grandparents raised him and his older brother Danney.
Petitioner’s grandfather died in 1970.
Petitioners were married in 1977. Mrs. Sykes had a 1-year-
old son, Gary, when petitioners married. Petitioner raised Gary
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