- 32 -
We agree with respondent for the reasons that follow. The
Gouveias reported gross income of $38,458 and $21,807 on their
1995 and 1996 returns, respectively. Twenty-five percent of
these amounts is $9,615 and $5,452, respectively. The McKenzie
Trust reported gross income of $14,148 and $11,986 in 1995 and
1996, respectively, which exceeds 25 percent of the gross income
reported by the Gouveias for 1995 and 1996. Although the
Gouveias’ returns listed the Pago Trust as a source of income,
the returns contained absolutely no reference to the McKenzie
Trust. Where the individual return makes no reference to the
trust as a source of income, we do not consider any documents in
addition to the individual returns in determining whether the
omitted income was adequately disclosed.25 Connell Bus. Co. v.
Commissioner, T.C. Memo. 2004-131; Reuter v. Commissioner, T.C.
Memo. 1985-607. We conclude, therefore, that respondent was not
apprised of the nature and amount of the omitted income
attributable to the McKenzie Trust. Accordingly, we hold that
the 6-year period of limitations in section 6501(e) applies to
the Gouveias’ 1995 and 1996 taxable years and that respondent’s
determination with respect to those years was timely.
25Even if we looked beyond the Gouveias’ returns to the
McKenzie Trust’s 1995 and 1996 returns, including the attached
Schedules K-1, they could not have adequately disclosed the
omitted income because they contained absolutely no mention of
the Gouveias.
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