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The Medical Practice
During the years at issue, Dr. Trowbridge provided medical
services at 9816 Memorial Blvd., Suite 205, Humble, Texas (the
medical practice). The books and records of the medical practice
were maintained under the cash method of accounting. Prior to
December 1996, the medical practice was referred to as “John
Parks Trowbridge MD”, and receipts from the medical practice were
deposited in two bank accounts styled “John Parks Trowbridge MD”.
Contemporaneous with the formation of Life Center in December
1996, Dr. Trowbridge began using the name “Life Center Houston”
for the medical practice. On January 8, 1997, cash receipts and
checks from the medical practice for the period December 3
through December 31, 1996, were deposited in the Life Center bank
account.
Dr. Trowbridge’s 1995 Through 1997 Forms 1040
1995 Form 10405
Some time in January 1997, the Internal Revenue
Service (IRS) received from Dr. Trowbridge a Form 1040, U.S.
Individual Income Tax Return 1995 (1995 Form 1040). Although
Dr. Trowbridge reported tax of $133,977 on that form, he also
inserted the following handwritten notation thereon: “SEE
ATTACHED DISCLAIMER STATEMENT–-ADMITTED TAX LIABILITY IS ZERO”.
5 As discussed infra, Dr. Trowbridge’s 1995 Form 1040 is
relevant to the determination of whether he is liable for the
sec. 6654 addition to tax with respect to his 1996 taxable year.
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Last modified: May 25, 2011