Kevin P. Osborne - Page 6

                                        - 6 -                                         
          Brenner v. Commissioner, 62 T.C. 878 (1974); Crawford v.                    
          Commissioner, 11 B.T.A. 1299 (1928).  Petitioner argues that out            
          of fairness he nonetheless should be entitled to a deduction                
          because he included the loan amounts in the income of the                   
          business when they were received by the business.  We do not                
          accept petitioner’s evidence that he included the amounts in                
          income in 1990 and 1992.  First, as noted above, the proffered              
          documents are not reliable evidence.  Second, petitioner did not            
          treat the loan payments consistently.  If he believed that the              
          business was required to report income when the loan was                    
          received, and entitled to a deduction when the loan was repaid,             
          then it is unclear why petitioner as an individual did not do the           
          reverse--claim a deduction upon initial disbursement, and report            
          income upon repayment.  These actions, of course, would have                
          canceled each other out for tax purposes because each would have            
          been reported on the same tax return.  In any event, even if we             
          assumed arguendo that petitioner overreported income for 1990 or            
          1992, neither of those years is within our jurisdiction here.               
               The final issue for decision is whether petitioner is liable           
          for the penalties under section 6662(a).                                    
               Respondent determined that petitioner was liable for the               
          penalties only with respect to the portions of the underpayments            
          attributable to petitioner’s deduction of the business promotion            
          expenses and the tax and license expenses.  Petitioner concedes             

Page:  Previous  1  2  3  4  5  6  7  8  9  Next

Last modified: May 25, 2011