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PENNSYLVANIA PREPARER'S CLIENTS HAVE A BAD DAY IN TAX COURT

September 14, 2006

It was a tough day for Chester Muhammad's tax clients. The Tax Court handed down five decisions disallowing deductions on returns prepared by Mr. Muhammad, imposing accuracy-related penalties on three of them.

All of the returns claimed deductions for charitible contributions to churches. Each taxpayer gave the Tax Court a computer-generated list provided by Mr. Muhammad listing weekly church donations. None of the taxpayers had any cancelled checks or third-party documents from the churches to back up the donations. It's an amazing coincidence that all of these clients had this exact same problem.

It appears that this won't be a problem for any future tax years, as Mr. Muhammad was summoned by a higher court last February.

Russ Fox has more at Taxable Talk.

Links:

Lewis v. Commissioner, T.C. Summary 2006-140

Harrell v. Commissioner, T.C. Summary 2006-141

Warren v. Commissioner, T.C. Summary 2006-142

Muhammad v. Commissioner, T.C. Summary 2006-144

Warfield v. Commissioner, T.C. Summary 2006-145

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