Timothy and Barbara Kosinski - Page 13




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          petitioner represented to the special agents that he was putting            
          away money “in anticipation of the Y2K problem”.  Petitioner                
          stated that he had $300,000 in cash in petitioners’ personal safe           
          at home and another $200,000 in cash in safe-deposit boxes.  Upon           
          review of the contents of the home safe, the special agents found           
          37 envelopes, each containing $5,000 in $100 bills, totaling                
          $185,000.  When asked why he withdrew cash in $9,500 increments,            
          petitioner stated that he did it because that was the way his               
          father used to make cash withdrawals and that he understood that            
          a form must be filled out if cash transactions exceed $10,000.              
          At the initial interview with the special agents, petitioner did            
          not mention that he made regular cash payments to Phillips.                 
               At petitioner’s second interview 2 days later, the special             
          agents’ review of the contents of petitioners’ safe-deposit boxes           
          revealed 60 envelopes, each containing $5,000 in cash, totaling             
          $300,000.  When the special agents asked about the balance of the           
          cash that petitioners had withdrawn over the last 3 years, which            
          the special agents estimated at approximately $1.8 million,                 
          petitioner said that “he spent it”.  He did mention to the                  
          special agents at that time that Phillips, his main contractor,             
          preferred to be paid in cash, and informed them that petitioner             
          issued Forms 1099 to Phillips each year, but Phillips did not               
          sign receipts for the cash payments he received from T.J.                   
          Construction.                                                               







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