Interex, Inc. - Page 2

                                        - 2 -                                         
          indicated, all section references are to the Internal Revenue               
          Code in effect for the year in issue.                                       
                                  FINDINGS OF FACT                                    
               Some of the facts have been stipulated, and the stipulated             
          facts are incorporated in our findings by this reference.                   
          Petitioner is a corporation located in Amesbury, Massachusetts,             
          at the time that its petition was filed.                                    
               Petitioner was in the business of designing, storing, and              
          refurbishing trade show exhibits.  Petitioner began its business            
          in mid-September 1993.  Tamara C. Olbres (Olbres) was the                   
          100-percent shareholder and president of petitioner.                        
               In 1994, petitioner was a C corporation.  Petitioner used              
          the accrual method of accounting.  On its Form 1120, U.S.                   
          Corporation Income Tax Return, for 1994, petitioner claimed a               
          deduction for professional fees in the amount of $66,865.  The              
          amount deducted was based in part on an adjusting entry to accrue           
          a professional fee in the amount of $65,000.  The Form 1120                 
          reported compensation paid to Olbres in the amount of $42,000,              
          salary and wages expense of $6,723, and taxable income of                   
          $75,689.  Petitioner’s Form 1120 was prepared and signed by                 
          George Coupounas (Coupounas), who represented himself to be a               
          knowledgeable certified public accountant and attorney.                     
               An audit of petitioner’s Federal income tax return for 1994            
          was commenced in early 1997, and an inquiry was made into the               

Page:  Previous  1  2  3  4  5  6  7  Next

Last modified: May 25, 2011