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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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