Opinion ID: 2582200
Heading Depth: 4
Heading Rank: 3

Heading: After the second hearing

Text: Byers produced a copy of a 2003 tax return, dated May 18, 2004, claiming an adjusted gross income of $15,551. Sherwin then composed a letter analyzing the return, in which he noted that there was no proof about whether the return had been filed, that Byers was attempting to claim as personal deductions expenses that he was already claiming as deductions for his partnership, and that the income Byers attributed to the partnership was inconsistent with the expenses he was claiming the partnership had paid. The letter also pointed out a number of inconsistencies between the May return and the previous three returns, and emphasized that [t]here is no indication in the data supplied how much money was actually paid to Thomas Byers [by the partnership] for 2003. Based on the information provided in the tax return, but excluding any improper accounting for vehicle expenses, supplies ($74,000) and the like, Sherwin provided a possible estimate of Byers's income: Ordinary Income per Form K-1 $25,042 [Simplified Employee Pension] Payment (pending proof of payment) (4,242) 50% of Depreciation taken on Form 1065 (This is a non-cash deduction[)] 4,605 Duplication of home office expenses 8,382 Permanent Fund Dividend 1,108 Net Income Tax Liability for 2003 (2,919) SEP payment to be refunded 631 _______ Total $32,607 Sherwin provided a second estimate, using Byers's expenses as a basis for estimating income: Tax per Form 1040 for 2003 @ 5/18/04 $ 2,919 Allowable SEP paid for 2003 3,611 Personal Household Costs-Mtg. Pmts. 7,470 Utilities 913 20% of Vehicle Expenses 2,131 Child Support 2,652 Personal (Food, hygiene, etc.) Per IRS Guidelines for A[laska] (One person) @ $790 per month 9,480 _______ Total $29,176 The letter emphasized that these figures assume[d] that Mr. Byers's latest testimony, information and the returns he has provided are more correct tha[n] any of the others he has previously provided, and went on to question whether Byers's SEP contributions were deductible for child support purposes. Byers responded with a letter of his own, disputing the figures cited by Sherwin, and claiming that his partnership had recently been audited by the IRS. He attached a letter from the IRS, dated May 6, 2004, stating that it had examined his partnership's tax return and had made no changes. Byers did not request a third hearing.