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B. Whether Petitioner Had Unreported Income in 1993-95
1. Petitioner’s Gross Receipts for 1993
Respondent contends that petitioner had unreported gross
receipts of $345,172 for 1993. Petitioner contends that he had
unreported gross receipts of $252,006 for 1993.
Respondent concedes that $38,834 of petitioner’s bank
deposits in 1993 was from Ms. Shaw’s business, a nontaxable
source. Petitioner contends that, because Ms. Shaw deposited
$132,393 from her business in her bank accounts in 1994, and
because she testified that her gross receipts were similar for
1993 and 1994, $132,000 from Ms. Shaw’s business was deposited in
his bank accounts in 1993.
There is no evidence that more than $38,834 of Ms. Shaw’s
gross receipts was deposited in petitioner’s bank accounts in
1993. Thus, because petitioner has the burden of proving that
his gross receipts were less than respondent determined, we
conclude that he had unreported gross receipts of $345,172 in
1993.5
2. Costs of Goods Sold
a. Positions of the Parties
Respondent determined that petitioner had costs of goods
sold of $199,073 for 1993, $213,564 for 1994, and $166,142 for
5 Petitioner concedes that he had unreported gross receipts
of $431,728 for 1994 and $338,276 for 1995.
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