I don't understand why the accountants did not report the Lynch note 1 payment of $125,188 to Jean O'Connell on April 21, 1991, until it was pointed out that they should.
Edward White wrote the Deed of Trust and the Notes that describe the time for the payments. He was Trustee for the Deed of Trustee. Joanne Barnes reported the Lynch note 2 payment to the Trust u/w of H. A. O'Connell on April 21, 1991. I sent Edward White and Joanne Barnes a copy of the Lynch Notes payment schedule on April 24, 1989.
"2. My copy [Of Jean O'Connell's 1991 IRS Form 1040] also does not show the principal of $125,188.17 paid to my mother by the Lynch Note in April of 1991. It does show the interest. With a gross profit percentage of .79 on the installment sale, about $98,898.65 of the $125,188.17 should have been reported on line 13 of the 1040 as a capital gain. It appears that this omission is up and above the penalties and interest already acknowledged. Why was it not reported? Will you amend the return?"
O'Connell to Edward White, in part.)
"With regard to the income tax matter and the capital gain from the receipt of principal on the Lynch note in April 1991, I was following the 1990 return and simply did not pick up the fact that there was a principal payment in 1991. I will most certainly pay any interest and penalty which might accrue in this regard, and sincerely appreciate your calling it to my attention."
(1992.06.11 Edward White to Anthony O'Connell, in part.)