Timmons v. Commissioner of Internal Revenue
| Decision Date | 23 July 1952 |
| Docket Number | No. 6438.,6438. |
| Citation | 198 F.2d 142 |
| Parties | TIMMONS v. COMMISSIONER OF INTERNAL REVENUE. |
| Court | U.S. Court of Appeals — Fourth Circuit |
Annie Mary Timmons, pro se.
Maryhelen Wigle, Sp. Asst. to the Atty. Gen. (Ellis N. Slack, Acting Asst. Atty. Gen., on brief), for respondent.
Before PARKER, Chief Judge, and SOPER and DOBIE, Circuit Judges.
This is a petition to review a decision of the Tax Court relating to income tax assessed against one Annie Mary Timmons for the years 1941, 1942 and 1943. Taxpayer was engaged in the rental of apartments at Columbia, S. C. She reported net operating loss of $1298.96 for the year 1941, net income of $939.05 for 1942 and net income of $1863.20 for the year 1943. She kept no books and refused to aid the government agents in any way in ascertaining her true income. The Commissioner of Internal Revenue assessed against her deficiencies of $1874.47 for 1941, $6885.92 for 1942 and $18,403.11 for 1943, with a five per cent negligence penalty for 1941 and fifty per cent fraud penalties for 1942 and 1943. The Tax Court held that the inaccuracies in her returns were due to inadequate records and relieved her of the fraud penalties assessed, but affirmed the Commissioner's assessment of deficiencies.
It appears that the deficiencies were arrived at by allowing taxpayer the deductions claimed by her but increasing gross income by the sum of $6550 for the year 1941, $19,846 for the year 1942 and $36,457 for the year 1943. The issue for determination by the Tax Court was whether the Commissioner in making the deficiency assessments, "correctly reconstructed the amount of petitioner's gross income from rentals for the years 1941, 1942 and 1943". The court has made no findings of fact with regard to this matter, however, and the Commissioner has set forth no such facts in his deficiency letters. It is, manifestly, not sufficient that we be told merely that the "tax agents reconstructed her income as best they could". The court should have found the facts upon which the reconstruction was based so that we could judge whether or not it was properly made. It is well settled that "there must be findings, stated either in the court's opinion or separately, which are sufficient to indicate the factual basis for the ultimate conclusion." Kelley v. Everglades Drainage Dist., 319 U.S. 415, 420-422, 63 S.Ct. 1141, 1145, 87 L.Ed. 1485; Mayo v. Lakeland Highlands Canning Co., 309 U.S. 310, 60 S.Ct. 517, 84 L.Ed. 774; Interstate Circuit Co. v. United States, 304 U.S. 55, 58 S.Ct. 768, 82 L.Ed. 1146; Public Service Commission v. Wisconsin Tel. Co., 289 U. S. 67, 53 S.Ct. 514, 77 L.Ed. 1036; Railroad Commission v. Maxcy, 281 U.S. 82, 50 S.Ct. 228, 74...
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