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penalties for negligence or disregard of rules or
regulations as follows: MI is liable with respect to
the TMI expenses deduction as disallowed, and S is
liable with respect to the excess TMI expenses
constructive dividend and the constructively received
interest income.
Robert E. Dallman, Vincent J. Beres, and Robert J. Misey,
Jr., for petitioners.
Christa A. Gruber, J. Paul Knap, and Michael Calabrese, for
respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
MARVEL, Judge: These cases were consolidated upon motion of
the parties for purposes of trial, briefing, and opinion.
Respondent determined deficiencies and section 6662(a)1 accuracy-
related penalties with respect to petitioners’ income tax and, by
amendment to answer, increased those deficiencies as follows:
Menard, Inc., docket No. 673-02
Accuracy-related penalty
TYE Jan. 31 Deficiency sec. 6662(a)
1998 $8,966,233 $430,414
1All section references are to the Internal Revenue Code in
effect for the years in issue, and all Rule references are to the
Tax Court Rules of Practice and Procedure. Monetary amounts are
rounded to the nearest dollar.
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