- 13 - 3. Whether FabuGlass Was Largely an Operating Company in 1990-94 a. Whether FabuGlass Had Operating Assets, Sales, or Paid Salaries in 1990-94 FabuGlass reported on its returns for 1990-94 that it had no operating assets and paid no salaries. This suggests that FabuGlass was not an operating company. FabuGlass reported total sales of $30,312 on its 1990-94 returns. That amount is insignificant compared to the $1,555,057 it reported as net losses from stock transactions for those years. b. Whether FabuGlass’ Tax Returns Establish That It Was an Investment Company FabuGlass reported on its 1990-95 returns and its first amended 1994 return that it was an investment company. Petitioners contend that we should disregard references to FabuGlass as an investment company on those returns because FabuGlass was not authorized by its articles of incorporation to engage in investment activities. We disagree. First, petitioner, as the sole owner of FabuGlass stock in 1990-95 and preparer of FabuGlass’ original 1994 return, cannot now disavow those returns without cogent proof that they are incorrect. Waring v. Commissioner, 412 F.2d 800, 801 (3d Cir. 1969), affg. per curiam T.C. Memo. 1968-126; Lare v. Commissioner, 62 T.C. 739, 750 (1974), affd. without published opinion 521 F.2d 1399 (3d Cir. 1975); Kaltreider v. Commissioner, 28 T.C. 121 (1957), affd. 255 F.2d 833 (3d Cir.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011