- 3 - Miscellaneous Income. Czarnowski submitted the Form 1099-MISC to respondent; petitioner, however, alleges that he did not receive the Form 1099-MISC. Petitioner, in preparing his 1999 Federal income tax return, reported the $51,217 of wages from Sparks- Piper, but he failed to report the $26,814 of compensation received from Czarnowski. Discussion Unreported Income Petitioner asserts that he is not liable for the tax on the compensation received from Czarnowski because he did not receive the Form 1099-MISC. Section 61(a)(1) provides that “gross income means all income from whatever source derived, including * * * Compensation for services”. Petitioner’s compensation from Czarnowski falls within this category, regardless whether petitioner received the Form 1099-MISC. Alternatively, petitioner argues that $4,403 of the compensation represents the sale of assets to Czarnowski. The amount received less the adjusted bases in the assets would still be income to petitioner. See secs. 61(a)(3), 1001, 1011. Petitioner has the burden to establish that he sold assets to Czarnowski and to establish his bases in the assets sold. See Rule 142(a)(1); Welch v. Helvering, 290 U.S. 111, 115 (1933).3 3 Sec. 7491(a) does not apply because petitioner failed to maintain adequate records.Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011