- 2 -
relating to petitioner’s liabilities, pursuant to the Federal
Insurance Contributions Act (FICA) and the Federal Unemployment
Tax Act (FUTA), for 1994 and the first quarter of 1995 (period in
issue). The issues for decision are whether: (1) Robert E.
Kovacevich (Kovacevich) was petitioner’s employee for Federal
employment tax purposes, (2) petitioner is entitled to relief
under section 530 of the Revenue Act of 1978, Pub. L. 95-600, 92
Stat. 2885, as amended (section 530), (3) petitioner owes
employment taxes pursuant to sections 3111 and 3301, and (4)
petitioner is liable for section 6656 and 6662(a) penalties.
FINDINGS OF FACT
On October 1, 1981, Kovacevich incorporated petitioner as
Robert E. Kovacevich, P.S., a Washington C corporation, whose
name was subsequently changed to Western Management, Inc. From
its incorporation and through the period in issue, petitioner’s
only source of income was from the provision of legal services,
and Kovacevich was petitioner’s sole shareholder, president, and
secretary-treasurer. In 1981, petitioner’s board of directors
voted to pay Kovacevich $28,000 in 1982 and $60,000, annually,
thereafter. Kovacevich designated the Seattle First National
Bank, Spokane and Eastern Branch (Seafirst), as the depository
for all of petitioner’s funds. All moneys that were paid on
1(...continued)
all Rule references are to the Tax Court Rules of Practice and
Procedure.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 Next
Last modified: May 25, 2011