William Lenihan - Page 10

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          petitioner reported on the Nov. 10 return.  Respondent argues,              
          however, that petitioner realized additional gross income of                
          $29,996 not reported on the Nov. 10 return on account of                    
          petitioner’s March 1, 2000, withdrawal of that amount from Hudson           
          United Bank.  Moreover, respondent disagrees with many of the               
          deductions claimed and calculations made on the Nov. 10 return.             
          Initially, respondent argued that petitioner is not entitled to             
          compute his 2000 income tax liability using the rate schedule for           
          a married couple making a joint return.  Respondent argued that             
          petitioner could not elect joint return status since, to do so,             
          he (and his wife) had to file a return on which they made a joint           
          return election.  Since respondent does not permit a taxpayer to            
          “file” a tax return for a year after respondent has issued the              
          taxpayer a notice of deficiency for the year, respondent argued             
          that petitioner had filed no return for 2000.  Having filed no              
          return for 2000, respondent continued, petitioner could not elect           
          joint return status.  Respondent additionally argued that                   
          petitioner was disqualified from making a joint return for 2000             
          because he failed to include his wife’s income on the Nov. 10               
          return.  In a supplement to brief, respondent conceded those two            
          arguments.  Respondent now accepts that petitioner is entitled to           
          use joint return rates for 2000.  We assume that respondent also            
          accepts petitioner’s claim of a deduction for two personal                  
          exemptions.  Our analyses of the remaining issues follow.                   






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