Raymond L. Monk, Jr. - Page 7




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               The IRS mailed Monk notices of deficiency for both years.              
          Monk timely filed petitions, the cases were consolidated, and               
          trial was held in Baltimore.  Monk was a resident of Maryland               
          when he filed.                                                              
                                       OPINION                                        
               The Commissioner claims that Monk’s original position on his           
          tax returns for 1994 through 2002--i.e., that Chuck’s Place was             
          his own Schedule C sole proprietorship--was an admission by Monk            
          and so is the proper way to classify his interest in the bar.  In           
          support, she points out that it is Monk’s name that was stated as           
          the bar’s owner on the liquor license and lottery paperwork.                
          Monk was also the only person originally named on the bar’s only            
          bank account; even now, Maney’s name is on that bank account not            
          as an owner, but only as someone with signatory authority.                  
          Finally, it was Monk who submitted the bar’s gross income and               
          losses to the IRS, not Maney.  Monk changed his position only               
          after the audit began.                                                      
               Each of these points supports the Commissioner’s view that             
          Monk actually owned Chuck’s Place, although maybe as a joint                
          venture or partnership with Maney rather than a sole                        
          proprietorship.7  But we look at all the facts together to decide           



               7 Characterizing any potential ownership interest as a sole            
          proprietorship would mean classifying Monk and Maney’s                      
          relationship as that of employer/employee.  Nothing in the record           
          supports this.                                                              





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