- 7 - business deductions for the 1991 taxable year. Accordingly, for 1991, respondent allowed a total of $157,207 of the $254,787 in deductions claimed by petitioner on the 1991 return. OPINION The issues we consider arise from circumstances surrounding petitioner’s criminal conviction for Medicaid fraud. Prior to his indictment, petitioner’s 1989 and 1990 Federal income tax returns did not reflect that he was engaged in the taxi-leasing business or that he received payments for Medicaid related services. Petitioner’s 1991 return was due a short time after his indictment. Following the acceptance of his plea of guilty, petitioner, during 1994, filed amended 1989 and 1990 returns and a delinquent 1991 return. The above events were the motivation for respondent’s examination of petitioner’s returns, resulting in a determination that petitioner had understated income for 1989 and 1990. Respondent also determined that a portion of petitioner’s claimed deductions on his amended returns for 1989 and 1990 and on his 1991 return should be disallowed. The fraud penalty was determined for all 3 years. For 1989 and 1990, the fraud penalty was attributable to respondent’s determination that petitioner failed to report all of his income. The determination of the fraud penalty for 1991 was based on respondent’s determination that petitioner intentionally overstated his deductions.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011