- 2 - SWIFT, Judge: Respondent determined deficiencies of $11,903 and $5,003, respectively, in petitioner’s Federal income taxes for petitioner’s tax years ending June 30, 2002 and 2003. Unless otherwise indicated, all section references are to the Internal Revenue Code in effect for the years in issue. The issue for decision is whether petitioner’s tax return preparation and bookkeeping services are to be treated as accounting services. If so, petitioner will be treated as a qualified personal service corporation under section 448(d)(2) and will be subject to the flat 35-percent tax rate set forth in section 11(b)(2). FINDINGS OF FACT Most of the facts have been stipulated and are so found. At the time the petition was filed, petitioner’s principal place of business was located in Las Vegas, Nevada. In 1978, Steve Rodgers (Rodgers) incorporated petitioner as a Nevada corporation, and until his death in 2002 Rodgers owned all of petitioner’s stock. Petitioner’s business consisted of providing tax return preparation and bookkeeping services, which services Rodgers and other individuals provided as petitioner’s employees. Over the years, Rodgers, on petitioner’s behalf, increased the number of petitioner’s clients and the number of employees to perform for petitioner’s clients tax return preparation andPage: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011