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September 22, 1996. The termination agreement was signed by
petitioner on behalf of himself and EGC.
From September 22, 1996, through the time of the execution
of the termination agreement, neither petitioner nor any
representative of petitioner or EGC provided a representative of
NGC or SYN with (1) substantiation of any medical expenses
incurred by petitioner, (2) information as to any treatments or
medications prescribed for petitioner, or (3) an exact dollar
figure that would compensate petitioner for any personal injuries
petitioner claims to have suffered as a direct result of the
dispute.
Receipt of Settlement Proceeds; Federal Tax Return
On or about December 17, 1996, petitioner received a check
from NGC in the amount of $2 million pursuant to the termination
agreement. NGC did not issue a Form 1099 to petitioner with
respect to that payment.
Petitioners requested an automatic 4-month extension to file
their 1996 tax return. On January 15, 1998, petitioners filed
their 1996 tax return, on which they reported a tax liability of
zero. Petitioners did not report the $2 million settlement
proceeds.
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Last modified: May 25, 2011