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Tax Examination Changes, prepared by Ms. Lucas and dated March 6,
1998. The Form 4549 used “Married - Separate” filing status in
computing the amount of the adjustments to income.
OPINION
Respondent’s Motion To Amend the Pleadings
At the conclusion of the trial, respondent moved to amend
the pleadings to conform to the evidence under Rule 41(b)(1). In
his motion, respondent argues that he should be permitted to
assert a fraud penalty under section 6663 against petitioner on
the basis that the issue of fraud had been tried by consent of
the parties. Respondent contends that petitioner committed fraud
by claiming a casualty loss deduction to which he knew he was not
entitled, by falsely claiming that the Property’s south building
had been completely destroyed and providing false information
regarding the building’s value. We shall deny respondent’s
motion to amend the pleadings.
The granting of a motion to conform the pleadings to the
evidence is within the discretion of the Court, tempered by sound
reason and fairness. Federated Graphics Cos. v. Commissioner,
T.C. Memo. 1992-347. Our review of the entire record in this
case convinces us that respondent was aware before trial of the
essential facts upon which his assertion of fraud is based. This
is demonstrated by an examination of respondent’s specific
allegations. Respondent relies primarily on the document
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