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failed to report the embezzled income, and Linda now seeks
innocent spouse relief under section 6015(b) and (f) from the
resulting deficiencies. 1
FINDINGS OF FACT
Linda and Jerry Haltom wed in 1974, and settled in Smyer, a
small town in West Texas where they reared their two children.
Jerry is a college graduate who took courses in accounting and
earned a degree in business administration. He worked for many
years as a food broker at Oliver Taylor Company West, Inc. While
Jerry advanced at the Taylor Company, Linda cared for their
children and ran the household. She had no formal education
beyond high school, and rarely worked outside the home until
1994.
Food brokerage is part salesmanship and part marketing, and
Jerry’s job was to work with food manufacturers such as Del
Monte, Heinz, and Capri Sun to get their products into
supermarkets and wholesalers throughout West Texas. He drew a
salary, but would often more than double that income through
commissions, bonuses, and awards.
By the late 1980s, a culture of fraud had taken hold in
several West Texas food brokerage companies. Over several years,
18 people from three different firms were convicted for cheating
1 All references to sections are to sections of the Internal
Revenue Code, and the one reference to a Rule is to the Tax Court
Rule of Practice and Procedure 155.
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