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records, each containing hundreds or perhaps thousands of
documents on the ground that respondent had refused to stipulate
after petitioner had proffered them on May 1, 2002, only 1 day
before the trial date.
Respondent’s counsel explained that she refused to blindly
stipulate four boxes of materials without some explanation or
understanding of the individual documents and their relevance
and/or relation to the controverted expense or income items. The
adjustments for petitioners’ 1992, 1993, and 1994 tax years
involved: Underreported gross receipts and disallowed expenses
and depreciation on Schedules C (Profit or Loss From Business),
income from a distribution from a retirement account for 1993,
increase and decrease of reported rental income, disallowance of
miscellaneous itemized deductions, self-employment tax, and
additions to tax under sections 6651(a)(1) and 6662. The
adjustments involved numerous individual items.
During the May 2, 2002, hearing, the Court inquired of
petitioners as to the organization of the contents of the four
boxes. Petitioner Smith, in response, explained that the
documents were not necessarily in chronological order and that
individual folders did not necessarily relate to any particular
adjustment in the notice of deficiency. The Court inspected one
of the numerous documents, a folder, and found that it contained
a large volume of loose papers and miscellaneous documents.
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Last modified: May 25, 2011