-4-
Les’ Deficiencies
Years Deficiencies Penalties
1990 $89,826 $67,370
1991 59,246 44,435
DDL’s Unpaid Liabilities
Years Income taxes Penalties
1990 $98,540 $73,905
1991 65,897 49,423
We decide as to the subject years:
1. Whether petitioner operated his medical practice through
a C corporation known as DDL. We hold he did.
2. Whether the Les’ gross income includes constructive
distributions in the amounts determined by respondent. We hold
it does.
3. Whether the Les, in their individual capacities, are
liable for the fraud penalties determined by respondent under
section 6663(a). We hold they are.
4. Whether the Les, as transferees of DDL’s assets, are
liable for DDL’s unpaid Federal corporate income taxes (inclusive
of penalties). We hold they are.
5. Whether the period of limitations under section 6501 has
run as to the Les’ personal income taxes. We hold it has not.4
FINDINGS OF FACT
4 On the basis of our holdings, we also sustain without
further comment certain computational adjustments made by
respondent and disputed by petitioners.
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