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The Masons consistently filed timely income tax returns for
almost 40 years, then stopped in 1987. They did not file their
income tax return for 1987 until May 1991 and did not file
another income tax return after that until October 1997 when they
filed an income tax return for 1996. They did not file timely
income tax returns for 1988 through 1995 despite having
significant taxable income in each of these years. When the
Masons eventually filed these income tax returns, they reported
adjusted gross income of $107,336 in 1993, $148,221 in 1994, and
$97,064 in 1995.
The Masons did not file their income tax return for 1995
until 3 years after it was due, and then only after respondent
initiated a criminal investigation for the Masons’ failure to
file. Petitioner pleaded guilty in May 2000 to willfully failing
to file a Federal income tax return for 1995 under section 7203.
Respondent determined a deficiency and a fraudulent failure
to file addition to tax under section 6651(f) for 1995.
Petitioner timely filed a petition with this Court for a
redetermination. The parties stipulated that there is a
deficiency in income tax for 1995 of $2,859.5 The only issue we
have to decide is whether petitioner’s failure to file an income
tax return for 1995 was fraudulent.
5Because the stipulated deficiency amount is different from
the deficiency amount in the statutory notice, a Rule 155
computation must be done.
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