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Respondent determined a deficiency of $5,144 in petitioner’s
2000 Federal income tax, an addition to tax of $257 under section
6651(a)(1), and an accuracy-related penalty of $1,029 under
section 6662(a).
After concessions by the parties as to petitioner’s
unreported interest of $106, and petitioner’s unreported ordinary
dividends of $129 and $21, the issues for decision are: (1)
Whether petitioner failed to include in gross income ordinary
dividend income in the amount of $18,432; (2) whether petitioner
is liable for an addition to tax under section 6651(a)(1); and
(3) whether petitioner is liable for an accuracy-related penalty
under section 6662(a).
Some of the facts in this case have been stipulated and are
so found. Petitioner resided in Eastchester, New York, at the
time he filed his petition.
Section 7491(a) does not affect the outcome because
petitioner’s liability for the deficiency is decided on the
preponderance of the evidence.
During taxable year 2000, petitioner owned 200 shares of
Bell Canada Enterprise, Inc. (BCE). In May 2000, pursuant to a
planned “Joint Arrangement” to distribute its Nortel Networks
Corp. (Nortel) stock, BCE distributed to petitioner 314 shares of
Nortel stock with a fair market value of approximately $18,432.
On Form 1099-DIV, Dividends and Distributions 2000,
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Last modified: May 25, 2011