- 4 -
deductions, and accounting expense equal to .13330232 percent of
the total disallowed deductions.
Respondent determined that the decision in Durham Farms #1,
J.V. v. Commissioner, supra, increased petitioners’ 1992 ordinary
income by $113,879; i.e., the sum of a $112,996 increase to
reflect the adjustment to the ordinary income of TBS 90-1, plus
an $883 increase to reflect an adjustment to petitioners’
reported itemized deductions. On May 13, 2002, respondent
reflected the $113,879 increase by assessing against petitioners
a $28,346 deficiency for 1992, as a computational adjustment
under section 6231(a)(6). On May 19, 2004, respondent issued to
petitioners the relevant affected items notice of deficiency.
Respondent determined in the notice of deficiency that
93.916476605 percent of the $112,996 increase ($106,122) is
attributable to disallowed depreciation deduction claimed by TBS
90-1; that the tax upon the $106,122 ($27,317) is subject to the
40-percent penalty attributable to gross valuation misstatement
under section 6662(h); and that the remainder of the deficiency
($1,029; i.e., $28,346 - $27,317) is subject to the 20-percent
accuracy-related penalty attributable to negligence or disregard
of the rules or regulations.
On April 17, 2006, the Court called this case for trial.
Petitioners were not present, and they did not present any
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: November 10, 2007