Lesley J. Smith, a.k.a. Lesley J. Scott - Page 5




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          the fee.  Petitioner gave Mr. Scott the receipts and checks.  For           
          most years, Karnival Klassics broke even or made a small profit.            
          Mr. Scott once told petitioner that Karnival Klassics had a loss            
          for the year and that they could deduct a loss for only 3 years.            
               Mr. Scott handled the family finances and dominated the                
          family.  He told petitioner the number of exemptions to claim for           
          her withholding.  The Scotts had a joint checking account they              
          used to pay household expenses.  Mr. Scott controlled and                   
          balanced the account.  The Scotts did not live well, and money              
          was always tight.  They had modest furnishings and vehicles, and            
          they never owned a home.                                                    
               Mr. Scott prepared their joint Federal income tax returns              
          for 1975 through 2000, all the tax years of their marriage.  Each           
          year, on or before the April 15 due date, Mr. Scott would place             
          the Federal and State returns before petitioner and instruct her            
          exactly where to sign each return.  Petitioner did not fill in              
          the date next to her signature; Mr. Scott did.4  Because Mr.                
          Scott was an accountant and provided bookkeeping records and                
          services and prepared tax returns for others, petitioner trusted            
          him to properly complete their tax returns, and she did not                 
          review them.  She did not look to see whether they owed tax or              
          were due a refund.  She did not know that Mr. Scott filed some of           

               4The dates on the Federal tax returns are in Mr. Scott’s               
          handwriting.                                                                






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