- 3 -
During the course of the investigation of petitioner’s
income tax filing obligations, respondent obtained the unsigned
copies of the joint 1996 and 1997 Federal income tax returns,
Forms 1040 and accompanying schedules (the draft returns), from
the tax consultant hired by petitioner to prepare the 1996 and
1997 Federal income tax returns. Respondent also obtained copies
of the work papers used by petitioner’s tax consultant to prepare
the draft returns.
During the course of respondent’s examination, on or about
April 14, 1999, petitioner and his wife Earnestine submitted to
respondent signed joint Forms 1040X, Amended U.S. Individual
Income Tax Return, for the taxable years 1996 and 1997. The
amended returns claimed deductions in addition to those reflected
on the draft returns. Respondent processed the amended returns
as original returns for 1996 and 1997 and assessed the tax as
shown thereon.
Respondent issued the notice of deficiency to petitioner and
his wife for both taxable years in issue and disallowed the
additional deductions claimed on the amended returns. Respondent
disallowed these additional deductions because petitioner did not
substantiate any of these deductions. Respondent did not
question any of the substantial deductions claimed on the draft
returns which were the basis for the amended returns. In effect,
respondent accepted the draft returns on behalf of petitioner and
Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011