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for the years 1991 and 1993. They did not include in their
gross income for 1993 any of the long-term capital gain
realized by the partnership during 1993. The notice of
deficiency issued to them states as follows:
As it cannot be determined what the
allocable share of such partnership income is
for any of the partners for any of the years,
all of the income has been allocated to each
partner, thus increasing your taxable income a
net $25,208 and $18,089 [sic] for taxable years
ending December 31, 1991 and 1993, respectively.
Thus, the notice of deficiency issued to James and his wife
has the effect of allocating to James 100 percent of the
partnership's ordinary income and interest income for 1991
and 1993 and 50 percent of the partnership's long-term
capital gain for 1993. In respondent's answer to the
petition that was filed on behalf of James and his wife,
respondent asserts that there is an increased deficiency
due from James and his wife on the theory that 100 percent
of the long-term capital gain realized by the partnership
during 1993 should be allocated to James.
Darwin and his wife did not include any partnership
income in the gross income reported on their joint returns
for the years 1990, 1991, and 1993. The notice of
deficiency issued to them states as follows:
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Last modified: May 25, 2011