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references are to the Internal Revenue Code in effect for the
years in issue. Rule references are to the Tax Court Rules of
Practice and Procedure. The decision to be entered is not
reviewable by any other court, and this opinion should not be
cited as authority.
Respondent determined deficiencies in, and penalties with
respect to, petitioner’s Federal income taxes as follows:
Year Deficiency Sec. 6662(a) Penalty
1994 $20,184 $4,005
1995 29,432 5,886
The issues for decision for each year are: (1) Whether
shareholder pro rata income from an S corporation is understated
on the joint Federal income tax return filed by petitioner and
his former spouse; (2) whether petitioner qualifies for relief
from liability under section 6015; and (3) whether the
underpayment of the tax required to be shown on petitioner’s
return is a substantial understatement of income tax.
Background
Some of the facts have been stipulated and are so found.
At the time the petition was filed, petitioner resided in
Valdosta, Georgia.
Petitioner is, and was during all relevant times, a
certified welder. During each year in issue, petitioner was
employed as a welder by, among other employers, Certified Welding
Services, Inc. (CWS), a Georgia corporation that he organized
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Last modified: May 25, 2011