Appeal from the Order of the Board of Finance and Revenue in case of Appeal of William Gosewisch and Theresa M. Gosewisch, Docket No. RPIT-937, dated January 28, 1976.
Paul S. Kimbol, with him P. J. DiQuinzio, and Dechert, Price & Rhoads, for appellants.
R. Scott Shearer, Deputy Attorney General, for appellee.
President Judge Bowman and Judges Wilkinson, Jr., Mencer, Rogers, Blatt, DiSalle and MacPhail. Judges Crumlish, Jr. and Craig did not participate. Opinion by Judge Rogers.
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William Gosewisch and Theresa M. Gosewisch, his wife, have filed a petition for review of the action of
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the Board of Finance and Revenue sustaining an additional assessment of $153.41, with interest, but without penalty, on account of their Pennsylvania Personal Income Tax for 1973, and refusing their application for a refund in the amount of $1355.30.
The parties have filed a stipulation of facts from which we have culled the following as our findings:
1. William and Theresa M. Gosewisch (hereinafter referred to as 'Appellants') are husband and wife and reside at 6004 Musket Road, Fort Washington, Pennsylvania 19034.
2. Appellants are on the cash basis of accounting for Pennsylvania Personal Income Tax purposes.
3. Appellants duly and timely filed a Pennsylvania Personal Income Tax Return for the taxable year 1973. Appellants reported taxable income for 1973 of $56,191.99, a tax due of $1,292.42, taxes withheld $2,320.96, and claimed a refund of $1,028.54. . . .
4. In 1973, Appellant William Gosewisch (hereinafter 'Taxpayer') received $65,596.36 as a lump sum distribution from the H.B. Frazer Company, Inc. Profit Sharing Trust. . . . Of that amount, $51,389.76 had accrued to Taxpayer's profit sharing plan account prior to June 1, 1971 and $14,206.60 had accrued to his profit sharing plan account after June 1, 1971. On their 1973 Personal Income Tax return Appellants reported as taxable compensation only the amount accrued after June 1, 1971, along with the amount of $24,000.08 received as salary as evidenced by the W-2 issued Taxpayer, producing a reported taxable compensation of $38,207.09.
5. The Personal Income Tax Bureau determined that Appellants' total taxable income for 1973 was $107,580.00. The Bureau determined
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that the $51,388.00 accrued to Taxpayer's profit-sharing plan account prior to June 1, 1971 and distributed to Taxpayer in 1973 by the H.B. Frazer Company, Inc. Profit Sharing Trust was taxable as compensation. As a result of this adjustment, the Bureau determined that Appellants' 1973 personal income tax was $2,474.37, applied the credit of $2,320.96 for tax withheld, and determined that a deficiency of $153.41 was still owed by Appellants.
7. On April 15, 1975, the Appellants filed a timely Petition for Reassessment in which they claimed that their correct 1973 Pennsylvania Personal Income Tax liability is $965.66 and that they were entitled to a refund of $1,355.30. By decision mailed October 15, 1975 the Personal Income Tax Board of Reassessment sustained the assessment in its entirety.
8. On November 12, 1975, Appellants filed a Petition for Review with the Board of Finance and Revenue. By Order dated January 28, 1976, the Board of Finance and Revenue sustained the assessment, but abated the penalties.
9. Prior to 1973, Taxpayer was employed by H.B. Frazer and Company, Inc. and was a participant in the H.B. Frazer Company, Inc. Profit ...