Hospice Nabs Partial Tax Court Win Despite ‘Bizarre’ Records

A California hospice business won a minor victory in a US Tax Court challenge to an IRS audit, despite keeping “bizarre” records.

The IRS may have overestimated Lakeview Hospice Care Inc.'s income in the audit, and the company and its principals—Armond Graibyan, his brother Arsen, and his wife Ani—don’t have to pay tax penalties, the court said in an opinion by Judge Mark V. Holmes.

The business’s unusual accounting methods “make any connection between its books and reality tenuous at best,” Holmes said, so the IRS was right to use a bank deposit analysis to audit the company when ...