Gordon v. Comm'r of Internal Revenue, Docket No. 2830-71.
| Decision Date | 30 January 1975 |
| Docket Number | Docket No. 2830-71. |
| Citation | 63 T.C. 501 |
| Parties | HARRY AND GERALDINE GORDON, PETITIONERS v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT |
| Court | U.S. Tax Court |
OPINION TEXT STARTS HERE
Bruce I. Hochman and Harvey D. Tack, for the petitioners.
Randall G. Dick, for the respondent.
Subsequent to the filing of the opinion in the case of Harry Gordon, 63 T.C. 51, (1974), both parties jointly and individually petitioned this Court for a Revision of Opinion. Upon consideration of these motions, certain changes are hereby made. Harry Gordon, 63 T.C. 51 (1974), modified.
SUPPLEMENTAL OPINION
An opinion (63 T.C. 51) was filed in this case on October 31, 1974. On November 18, 1974, the parties filed a Joint Motion for Revision of Opinion. On November 19, 1974, respondent filed a Motion for Reconsideration and Revision of Opinion, together with a memorandum brief, to which petitioner filed a reply on December 26, 1974. On December 2, 1974, petitioner filed a Motion for Reconsideration to which respondent replied on January 2, 1975. After considering the parties' various motions and briefs, we make the following changes in our original opinion:
(1) Delete lines 25 through 33 on page 69 and substitute therefor the following:
Ninth Circuit), upholding such fifth amendment claims. Hill v. Philpott, 445 F.2d 144 (C.A. 7, 1971); Vonder Ahe v. Howland (C.A. 9, 1973, 31 AFTR 2d 73-1075, 73-1 USTC par. 9333), reversing (N.D. Cal. 1971, 27 AFTR 2d 71-1176, 71-1 USTC par. 9315). However, the Ninth Circuit has since withdrawn its original opinion and left this point undecided. 74-2 USTC par. 9825 (C.A. 9, 1974). And the Sixth Circuit has held that no fifth amendment rights are violated by such procedure. United States v. Blank, 459 F.2d 383 (C.A. 6, 1972), certiorari denied 409 U.S. 887 (1972). But despite the presently somewhat confused state of the law on this question, one factor present in our case renders it unnecessary to consider further this fifth amendment contention. The record herein were not the private
(2) Delete the last 4 lines on page 76 through the top 8 lines of page 78, and substitute therefor the following:
The Derby's gross-profit percentage for the horse book for 1967 according to its books and records (which reflect only bets on which the Federal excise tax was paid and do not reflect coded bets on which no tax was paid) was 24.75 percent. We conclude that the gross profit attributable to the horse book operation for 1967 is $381,928.93, computed as follows:
The Derby's gross-profit percentage for the sports book for 1967 according to its books and records was 7.79 percent. We conclude that the gross profit attributable to the sports book for 1967 is $11,519.10, computed as follows:
Using the above calculations, the total gross profit of the Derby for 1967 was $393,448.03, of which only $305,195 was reported on its partnership return, leaving $88,253.03 unreported. Petitioner's 80-percent interest in the unreported profit of the Derby is $70,602.42.
Petitioner noted that respondent's method of projecting income had failed to allow a deduction or offset to income for the accrual of excise tax for the Derby, an accrual basis taxpayer. We agree with petitioner that the Derby is entitled to accrue the wagering tax and, as noted above, have allowed such accrual. ...
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