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represented the $43,983.72 in the “YTD 1099" column on the
December 21, 2000, settlement statement from ARL, plus payments
received from two other companies, Gilco Properties and RB&B
Trucking.
On Form 1099-MISC, Miscellaneous Income, ARL reported the
amount it had paid to Mr. Hall in 2000 to the Internal Revenue
Service. The parties stipulated that the information return
issued by ARL reflected that ARL paid $95,455 to Mr. Hall during
the year in question.3 Petitioners did not receive the Form
1099-MISC from ARL. The Form 1099-MISC was not produced at
trial, but respondent’s explanation of adjustments refers to it,
indicating that a Form 1099 was received by respondent.
The issue for decision is whether, on their 2000 income tax
return, petitioners underreported gross trade or business income
of $51,470, the difference between the $95,455 on the Form 1099
filed by ARL and the $43,983.72 stated on the settlement
statement issued to Mr. Hall by ARL. Generally, the taxpayer has
the burden of proving that the determinations made by
Commissioner in the notice of deficiency are erroneous. Rule
142(a); Welch v. Helvering, 290 U.S. 111 (1933). However,
section 6201(d) provides that, if the taxpayer, in a court
3 In later correspondence with respondent, ARL indicated
that the Form 1099 had understated the amount paid to Mr. Hall by
$1,349. However, respondent has not sought an increased
deficiency.
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Last modified: May 25, 2011