Wayne Payne and Dorene J. Payne - Page 12

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          Respondent must prove fraud for each year at issue.  See id. at             
          210; Ferguson v. Commissioner, T.C. Memo. 2004-90.                          
               Petitioners argue that they did not file their returns with            
          fraudulent intent because they gave all of the responsibility               
          regarding the preparation of HRDC’s and their 1993, 1994, and               
          1995 returns to Ms. Enerson and their tax return preparers.  They           
          also claim that they did not have control over HRDC’s books                 
          because Ms. Enerson maintained them and they did not review their           
          returns before they were filed.  We are unconvinced by                      
          petitioners’ explanations.  Petitioners rely heavily on the fact            
          that Mr. Payne was a high school educated roofer and did not                
          understand tax or business records.  However, Ms. Enerson was               
          hired soon after graduating from high school and had no                     
          experience as either a bookkeeper or a tax return preparer.                 
          Petitioners claim they had no knowledge of what Ms. Enerson                 
          provided to Mr. Gunderson for the preparation of their returns.             
          The record does not support petitioners’ claim.  Petitioners met            
          with Mr. Gunderson when they hired him and discussed the relevant           
          aspects of the business.  During this initial meeting, Mr.                  
          Gunderson asked if all the money from the business went into the            
          bank accounts.  Mr. Payne told him it did.  As a result, Mr.                
          Gunderson used only HRDC’s bank records, which did not accurately           
          reflect HRDC’s income, to complete the returns.  Because                    
          petitioners gave Mr. Campion the 1995 return prepared by Mr.                

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