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work. Sal Parziale was employed as a supervisor with Joseph
Williams Homes Construction Co. (JWH), a subsidiary of the
Italian Brothers Construction Co. (IBC). Sal Parziale’s brother,
Joseph Parziale, was president of both IBC and JWH.
The projects involved the restoration of houses damaged by
flood or fire for which payment was made to JWH by insurance
companies. Petitioner was hired by Sal Parziale to work on three
projects. He worked on the “Roach” project, a house damaged by
fire, the “Penny” project, a water damaged trailer, and the
“Wise” project on which he did some painting. Petitioner was
paid for his work after the insurance companies paid JWH.
Petitioners’ 1997 Federal Income tax return was received and
date stamped by the Commissioner on September 4, 1998.
Petitioners did not report any income from JWH and the Parziale
brothers. Sal Parziale sent to petitioner and the Commissioner
Form 1099-MISC, Miscellaneous Income, reporting nonemployee
compensation paid to petitioner of $27,429 for 1997.
The notice of deficiency determined an increase in
petitioners’ income of $27,429, which was the amount reflected on
Form 1099-MISC. The petition states that “Barry Mangels worked
for John Salvatore Parziale and made $6,000 not $27,429.” At
trial, petitioner conceded that he received $11,471 in income in
1997 from Sal Parziale by way of checks.
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Last modified: May 25, 2011