Lisa B. Williams - Page 10

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          disinterested generosity.  The bonuses were set by a third person           
          and based on petitioner’s quality performance and approved by               
          Drs. Deland and Noell.  The facts in this record do not support a           
          finding that the payments to petitioner were intended as gifts.             
          See also sec. 102(c); Leschke v. Commissioner, T.C. Memo. 2001-             
          18.  Accordingly, we hold that the $25,000, $35,000, and $35,000            
          payments of bonuses constituted gross income that petitioner                
          failed to report.                                                           
               Next, we address petitioner’s claim that the normal 3-year             
          period for assessment had expired prior to respondent’s issuance            
          of the notice of deficiency for the 1993 and 1994 tax years.                
          There is agreement that the period for assessment under section             
          6501 was not extended by written consent of the parties.  As of             
          April 13, 1999, when respondent mailed the notice of deficiency             
          to petitioner, more than 3 years had elapsed since the filing of            
          petitioner’s return for 1993 and 1994.  Respondent, however,                
          relies on section 6501(e), which provides for a 6-year period for           
          assessment, if a taxpayer “omits from gross income an amount                
          properly includible therein which is in excess of 25 percent of             
          the amount of gross income stated in the return”.                           
               In that regard, respondent bears the burden of showing the             
          25-percent omission.  We have already decided, based on the                 
          preponderance of the evidence, that the bonuses were includable             
          in petitioner’s gross income for 1993 and 1994.  Petitioner and             

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