Detroit Free Press from Detroit, Michigan • Page 6

Detroit -ifrwPm SELLER ITH KNK.H7 U.45 RJUOtR Wi ti is iim Missing Kresge heiress declared dead by court IS GETTING AUDITED Percentage of individual federal tax returns audited by the Internal Revenue Service. DETROIT FREE PRESS WEDNESDAY, APRIL 7, 1993 Audit zeroes in on dubious write-offs Stretched deductions become IRS target 2.1 i.5 7i fM? 91 Aaron Epstein Press Washington Staff Sourca Internal Revenue Service a 3pf lull ASHINGTON Your chance of getting audited by the IRS keeps going down. But if your number comes ud. watch out: The eovern- (USPS 155-5001 (ISSN 1055-27581 Published Daily by Detroit Free Press at 321 Lalayene. Detroit.

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Classified Advertising 977-7500 TOLL FREE 1-800-WANT-ADS Display Advertising 222-2355 All Other Departments 222-6400 Telecommunicalion Device for Deaf (TDD) 222-2576 OFFICERS Frank J. Vega. President CEO 222-2060 Robert Althaus, Sr VP-Circulation 222-2373 Gary Anderson. Sr VP CFO 222-2167 Elizabeth Connor, VPHuman Resources 222-21 14 Gasper Genovese VP'Information Systems 222-8730 Timothy Kelleher. Sr.

VPLabor Relatons 222-2424 Richard McClennen, Sr. VP-Marketing 222-2459 N. Suzanne Miles VPMarketing Services 222-6680 Randy Miller, VP'Plannmg 4 Development 222-2061 Keith Pierce. VP'Operations 222-2389 ceived $1.3 million from the sale of factory property in Detroit. The attorney, Hanley Gurwin, said he arranged for an accountant to meet with Donald DeArment's attorneys to trace the money, which Gurwin wanted included in the divorce settlement.

Only days before that meeting was to take place, Carol DeArment disappeared. Rollinger, the detective, said he thinks Carol DeArment confronted her husband about the money that evening. "At that time, he probably struck her or strangled her and then somehow disposed of her body," he said. Police found a silver-dollar-size blood stain on the sofa in the den. They found another blood stain in the trunk of Donald DeArment's 1978 Mercedes.

Without a blood sample from Carol DeArment to match, FBI lab technicians compared the stains to blood samples taken from the children and the husband. Rollinger said the tests showed a 98-percent probability that the blood stains belonged to the missing woman. Robert Harrison, who represented Donald DeArment before he died, disputes that result. No charges had been brought when Donald DeArment. The veteran detective visited DeArment in his hospital room in the last hours of his life.

He said he was hoping against hope for a deathbed confession. Donald DeArment never said a word. HEIRESS, from Page 1A ance have different theories about what happened that night What's known for sure is that after 14 turbulent years, the marriage of Carol and Donald DeArment had reached a breaking point Carol Kresge was the great-granddaughter of Sebastian Kresge, founder of S.S. Kresge and Kmart Corp. She was a 22-year-old Western Michigan University dropout when she met Donald DeArment on an airplane bound for Chicago.

He was 42, an established businessman, and a physical fitness fanatic with old-fashioned notions about a woman's role in a relationship. They wed in 1969, only months after he divorced his first wife. Though she had the blue blood, he was wealthier. He owned four area auto supply firms and at his death, left an estate of more than $1.7 million. Friends recall that Carol DeAr-ment's attraction to her husband waned.

She chafed at his authoritarian manner and sexual demands. In her divorce complaint, Carol DeArment accused her husband of verbal and physical abuse. A judge ordered Donald DeArment not to enter the den, which Carol used for a bedroom, while the divorce was pending. Shortly before she disappeared, Carol DeArment's attorney said he had discovered that Donald DeArment had recently and secretly re one who regularly attended mass, and Manning's spouse, Audrie, who claimed she made the donations, was not one of them. Her "clearly incredible" testimony was but one of many indicators of an intent to evade taxes, U.S.

Tax Court Judge John Colvin said in an opinion last week. Returns such as the Mannings' are ideal for audits, tax accountants say, because of myriad deductions. The chances of being audited have declined because IRS workers and technology have not kept pace with the increased numbers of returns. The IRS audited less than 1 percent of individual returns last year, down from 2.1 percent in 1976. But those caught with trying to evade taxes face increasingly severe civil penalties, which have nearly tripled in the last 10 years to $4 billion.

In extreme cases, taxpayers may face criminal prosecution and possible prison terms if convicted. To pick returns to audit, the IRS uses computer formulas that are among the best kept secrets in Washington. A high score based on the formulas can trigger an audit. "No more than a dozen people at the IRS know the formula, and the formula keeps changing," said IRS spokesman Wilson Fadeley. PATRICIA CHARGOT Detroit Free Press The IRS has disclosed, however, that it is focusing on sole proprietorship (Schedule C) returns with income over $100,000.

IRS lawyer Keith Gorman, who handled the Manning case, declined to estimate how much the Mannings owe in unpaid taxes and civil fraud penalties as a result of Judge Colvin's ruling. Manning made false claims that "he entertained doctors he never entertained," that his mother lived with him when she never did and that the doctor said, in 1983, that his wife's mother "lived with them for 12 months when she died in May," the judge said. In addition, the judge found that half of the 12 trips Manning deducted as business expenses were taken for personal reasons. Manning testified that the primary purpose of his 1984 trip to Europe with his wife and two friends was to see German medical equipment. But the judge said it was "for a vacation and to take delivery of the BMW." Manning could not be reached either at his Philadelphia area home or his office at Nazareth Hospital in Philadelphia.

"He is on vacation in Florida," a hospital receptionist said. jinent can be dogged and resourceful in tooting out tax dodges. Ak Francis Manning, a Philadelphia radiologist. i Returns for him and his wife, and Ibis 'corporation, Francis P. Manning listed an assortment of deductions: flowers, hockey tickets, swim-! ming pool chemicals, a BMW, family birthday parties, California wine, a gin 1 umtny tournament, golf expenses, a 'krOm trips and thousands of dollars in i cash contributions to churches.

So along comes an IRS audit for 1931 through 1985. Agents zealously nicked each item they thought suspi-i nous. They analyzed the ink from his receipts and his diary and discov- ered that some of the inks were not available on the dates shown on the documents. And those church contributions sit average $50 a week in cash in the I plate at two Catholic parish-I es.The IRS brought in two priests to i refute that claim. The priests said they knew every Now Through Saturday Onlyt TAKE 50.00 OFF ALREADY-REDUCED MEN'S SUITS BY ALBERT NIPON Spring and summer selections.

Orig. 400.00 Currently 299 99 Now 249-99 (Nipon Couture not included.) TAKE 20.00 OFF BLAZERS 25 to 30 OFF FAMOUS-MAKER SPRING HANDBAGS 19-99 to 209.99 Leather, vinyl, patent clutches, hobos satchels. Orig. 30.00 to 285.00 FINE LEATHER HANDBAGS 49.99 to 99-99 A terrific assortment from Etienne Algncr, Ganson and more. Specially priced.

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59. 99 to 79.99 49-99 to 69.99 ADDITIONAL 25 OFF ALL ALREADY-REDUCED MEN'S OUTERWEAR Orig. 70.00 to 120.00 Currently 39.99 to 89 99 Now 29.99 to 67.49 3.29 to 29.99 Play Clothes for Girls Boys of Every Age Levi's OshKosh Buster Brown Palmetto's Ocean Pacific Dockers Bugle Boy Carter's Exclusively Ours Tops, pants, jeans, skirts, dresses, shorts. Infants, toddlers, girls' sizes 4 to 14. Specially priced Take 5.00 Off Men's Long Half-Sleeved Dress Shirts Our entire Man's Shop collection in pinpoint, oxford cloth or broadcloth cotton-polyester.

Reg. 19.99 to 29.99 14.99 to 24.99 Christian Dior Dress Shirts All our broadcloth solid colors and patterns in cotton-polyester. Keg. 34.50 to 39.50 22.99 to 29-99 3 Take 25 Off Silk Ties, Christian Dior Justhen you need them most, holiday it, 1 ''A 7 20 Exclusively Ours Superb Dior classics and contemporary Metropolitan collection ties. Eeg.

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99 to 49.50 Currently 19.99 to 34.99 Now 14.99 to 26.24 Specially 25 OFF MEN'S SPORTSWEAR FROM I FAMOUS MAKERS DESIGNERS The Designer Famous for Easy Elegance That Free-Spirited American Designer America's Creative Designer for Men Sportswear with the Famous Logo 19-99 to 132.99 Jackets, sweaters, shirts, knits, slacks shorts. Orig. 30.00 to 178.00 14.99 and 19-99 COTTON KNIT SHIRTS, PANTY STOCK UP! BUY 1 TO 5 PAIRS, SAVE 25 6 OR MORE, SAVE 30 Entire collections from Henson's Warner's Olga Formflt TAKE 25 OFF CALVIN KLEIN PANTIES AND DAYWEAR SELECTIONS Basic Cotton panties, bras camisoles All-over stretch lace tanks, bodysuits, panties TAKE 25 OFF SELECTED COTTON SPORT BRAS Maidenform MIy of France Olga Vanity Fair Warner's Bali 12.99 ALL WARNER'S BRAS For all figures including softcups, i demis and full-figure selections. Reg. 14.00 to 25.00 15.99 ALL OLGA BRAS Choose from a selection of underwire, padded, contour, demi and full figure bras.

Reg. 20.00 to 24.00 BUY ONE MAIDENFORM BRA, I 50 OFF THE SECOND Choose from underwires, demis, contours, pads coordinating panties. (Stcond bra must be of equal ot lesser value.) TAKE 25 OFF SELECTED FULL-FIGURE FAVORITES Vanity Fair Warner's Underscene Bali Flcxees Subtract" Bras, foundations, shapers. 50 Off All Diamond Jewelry 50 Off All 14-kt. Gold Jewelry 40 Off All Precious and Semi-Precious Jewelry Set in 14-Kt.

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20.00 to 80.00 14.99 to 39.99 2 for 20.00 Selected Monet Earrings Choose from goldtone or silvertone buttons, drops or hoops. Reg. 12.50 to 23. 00 Now Through Saturday Onlyt Take 25 Off American Designer Faux Pearls Reg. 18.00 to 85.00 13.50 to 63.75 Take 25 Off Marvella Faux Pearl Earrings Reg.

10.00 to 55.00 7.50 to 41.25 Take 25 Off Freshwater Pearls Reg. 14.99 to 59.99 11.24 to 44.99 SPECIALLY PRICED EXCLUSIVELY OURS 17.99 to 27.99 HALF-SLEEVED SPORTSHIRTS Solids and patterns including a great madras assortment. Specially priced. 12.99 to 19.99 SHORTS, EXCLUSIVELY OURS Walk shorts, active lengths, exceptional fabrics and patterns. Specially priced.

44.99 to 84.99 MEN'S DRESS CASUAL SHOES Nunn Bush and Brass Boot selections. Reg. 65.00 to 125.00 Your reduction off ticketed prices will be taken at the register. Selected collections, not every style and size in every store. Sale ends Saturday, April 10.

Lord Taylor, Fairlane, Lakeside and Twelve Oaks. Our regular and original prices are offering prices only and may or may not have resulted in sales. Advertised merchandise may be available at sale prices in upcoming sale events..