James O. Jondahl - Page 9

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          $42,873.24 was paid by petitioner in restitution to the IRS as              
          part of the resolution of his criminal case.  A review of the               
          pre-sentence investigation report shows that the amounts for                
          which petitioner was required to pay restitution are the very               
          same adjustments at issue in this case, including, for instance,            
          the commissions relating to petitioner’s sale of real estate,               
          payments by Taxman for petitioner’s furniture, and the sale of              
          petitioner’s crop hail insurance business.  Accordingly, we                 
          reject respondent’s contention that the $42,873.24 represents an            
          adjustment not at issue.                                                    
               Finally, respondent argues that petitioner’s offer fails               
          because it would not fully resolve petitioner’s liability, and              
          only that liability, for the type or types of taxes and the                 
          taxable year or years in the proceeding required by section                 
          301.7430-7(c)(3), Proced. & Admin. Regs.  In the offer letter,              
          petitioner’s counsel writes of the $12,000 amount that “the                 
          additional liability would be allocated in the following amounts:           
          $5,000 to the 1991 tax year; $1,000 for the 1992 tax year; $1,000           
          for the 1993 tax year, and $5,000 to the 1994 tax year.”  The               
          problem with this attempted allocation is that the 1994 tax year            
          was not at issue.  However, looking at this allocation in its               
          context, we find that the inclusion of the 1994 tax year was                
          nothing more than a typographical error of petitioner’s counsel.            
          The preceding sentence clearly indicates that the $12,000 was to            






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