- 7 - activity. Petitioner’s business activities consisted of meeting with people and trying to recruit them into the activity. Petitioner testified that his tax return preparer, Robin Manasseh (Ms. Manasseh), introduced him to the scheme and told him that he could deduct expenses related to recruiting other individuals. After getting involved, petitioner testified that he discovered that Ms. Manasseh was being investigated and that she informed petitioner to stop trying to recruit people until the investigation was finished. Petitioner had difficulty explaining how the various items constituting the Schedule C loss related to a business activity. He testified that he did not know of any advertising expenses, that he had “absolutely no idea” what the $24,944 reported as depreciation related to, that he did not know what the $8,707 in repair service expenses related to, and that he did not make any gifts to charities other than those listed on other parts of his tax return. He testified that he claimed expenses related to playing golf and meals on the basis of the advice of Ms. Manasseh. Petitioner acknowledged that it occurred to him that this may have been too good to be true and that he did not take steps to investigate what he was told other than trusting the judgment of Ms. Manasseh. Petitioner also acknowledged a large part of food expenses were for meals that he had by himself andPage: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011