- 18 -
other damages received via Jury Verdict and finally by
the Release and Settlement Agreement of November 17,
1995.
Additionally, with respect to petitioner’s interest in TS
Capital, petitioner reported losses in the amount of $30,587.
Petitioner’s return for 1999 showed no tax due. Petitioner also
claimed a $100,000 deduction for legal fees.
On July 13, 2001, petitioner filed Forms 1040X, Amended U.S.
Individual Income Tax Return, for 1996, 1997, and 1998, stating,
among other things, that “$95,088 of reported income was not
includable in taxpayer income. Section 104(a)(2) establishes
taxpayer guidance for excludability, along with RR 65-29 and
RR 76-133 and PL 97-473.” This resulted in petitioner’s
requesting a refund of $7,654 for 1997.
Internal Revenue Service (IRS) Determinations
In connection with the damages awarded to petitioner under
the settlement agreement, the IRS determined that all amounts
received by petitioner in 1995, 1996, 1997, 1998, and 1999 were
taxable income.
In connection with Green Capital and TS Capital, the IRS
disallowed all losses and subsequent carryforward losses claimed
by petitioner in 1995, 1996, 1997, 1998, and 1999. The IRS also
disallowed the $100,000 itemized deduction petitioner claimed in
1999.
Page: Previous 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 NextLast modified: May 25, 2011