James E. Anderson and Cheryl J. Latos - Page 3




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          1998 (1998 return).  In the 1998 return, Ms. Latos and Mr.                  
          Anderson claimed four exemptions and a total exemption amount of            
          $22,800 and showed Federal income tax (income tax) due of $6,302.           
          When Ms. Latos and Mr. Anderson filed the 1998 return, they did             
          not pay the income tax due shown in that return.                            
               At a time not disclosed by the record, respondent determined           
          that Ms. Latos and Mr. Anderson made a mathematical error in                
          claiming in their 1998 return a total exemption amount for four             
          exemptions of $22,800, instead of $10,800.3  Respondent corrected           
          that mathematical error and the resulting error that Ms. Latos              
          and Mr. Anderson made in computing the amount of income tax due             
          shown in their 1998 return.  The correct amount of income tax               
          that Ms. Latos and Mr. Anderson should have shown due in that               
          return is $9,662 (correct amount of 1998 tax due).4                         
               On June 7, 1999, respondent assessed the correct amount of             
          1998 tax due, additions to tax under sections 6651(a)(2) and 6654           
          for Ms. Latos’ taxable year 1998, and interest as provided by               
          law.  (We shall refer to any such unpaid assessed amounts with              
          respect to Ms. Latos’ taxable year 1998, as well as interest                
          provided by law accrued after June 7, 1999, as Ms. Latos’ unpaid            
          1998 liability.)                                                            


               3Each exemption amount for the taxable year 1998 of Ms.                
          Latos and Mr. Anderson was $2,700.                                          
               4The correct amount of 1998 tax due does not include any               
          self-employment tax.                                                        





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