- 14 -
In notices of deficiency dated May 23, 1995, respondent
determined that Vortex’s unreported income10 for the FYEs 1990
through 1993 was taxable to the Zhadanovs personally as
constructive dividends. Respondent also determined that Mr.
Zhadanov must include a portion of his Social Security benefit
for 1993 in income and that the Zhadanovs were liable for the
fraud penalty under section 6663 or, alternatively, for the
accuracy-related penalty under section 6662 for each of the
taxable years at issue.
OPINION
I. The Statute of Limitations Issues
Petitioners contend that the period of limitations on
assessment has expired with respect to the Zhadanovs for 1990 and
1991 and with respect to Vortex for FYE 1991. The Zhadanovs
timely filed their 1990 tax return on April 15, 1991, and filed
their 1991 tax return on April 15, 1992. Respondent mailed the
notice of deficiency for those years on May 23, 1995. Vortex
timely filed its tax return for FYE 1991 on December 16, 1991,
and the notice of deficiency for that year was issued on May 23,
1995.
Generally, the Commissioner must assess an income tax
deficiency for a specified year within 3 years from the date the
10Respondent determined the Zhadanovs received $117,829 for
1990; $203,813 for 1991; $249,318 for 1992; and $157,386 for 1993
from Vortex (totaling $728,346 for the years at issue).
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011