Dennis E. Runkle and Debra A. Runkle - Page 15

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               Special Agent Fabina learned that Mr. Runkle, on behalf of             
          the Elknur Family Limited Partnership, purchased a Kawasaki jet             
          ski and a trailer for approximately $2,000 from R&D Motorsports,            
          Inc. (R&D), on June 23, 1995.  Shortly thereafter, Special Agent            
          Fabina served a summons on R&D for their books and records                  
          pertaining to all transactions involving Mr. Runkle and the                 
          Elknur Family Limited Partnership for the years at issue.  Mr.              
          Runkle advised Randy Bills of R&D that respondent was prevented             
          by court order from obtaining records of the Elknur Family                  
          Limited Partnership, and Mr. Runkle threatened to sue Mr. Bills             
          if Mr. Bills gave any documents to Special Agent Fabina, even               
          though Mr. Runkle knew that there was never a court order that              
          prevented respondent from summonsing and receiving documents and            
          information pertaining to the Elknur Family Limited Partnership.            
               In addition to all the actions to quash the various                    
          summonses, petitioners filed a motion to dismiss this case on               
          February 17, 2004.  Petitioners testified that they filed their             
          motion to dismiss as a “tool” to force respondent to concede the            
          fraudulent failure to file additions under section 6651(f) for              
          the years at issue.                                                         
          Deficiency Notices                                                          
               By deficiency notices dated August 7, 2002, respondent                 
          determined deficiencies in, and additions to, each petitioner’s             
          Federal income taxes as follows:                                            

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