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of $53,532 with regard to petitioners William and Josephine
Houchin’s 1999 Federal income tax. Respondent determined the
following deficiencies in and accuracy-related penalties on
petitioner W.C. Houchin Corp.’s Federal income taxes:
Penalty
Year Deficiency Sec. 6662(a)
1998 $1,211,643 $242,329
1999 1,276,748 255,350
After concessions,3 we must decide (1) whether petitioner W.C.
Houchin Corp. should recognize $6,145,315 of lawsuit settlement
proceeds in income in 1998, (2) whether petitioners William and
Josephine Houchin are liable for the accuracy-related penalty
pursuant to section 6662(a) for 1999, and (3) whether W.C.
Houchin Corp. is liable for the accuracy-related penalty pursuant
to section 6662(a) for 1998.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. Petitioners William and
2(...continued)
the Internal Revenue Code, and all Rule references are to the Tax
Court Rules of Practice and Procedure.
3 On brief, respondent conceded the 1999 deficiency and
penalty related to W.C. Houchin Corp. Petitioners and respondent
stipulated the treatment of several adjustments in the notices of
deficiency issued to W.C. Houchin Corp. for the year 1998 and to
William and Josephine Houchin for the year 1999 if the Court
finds for respondent with regard to the recognition of income by
W.C. Houchin Corp. in 1998.
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