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qualifies as interest "accrued on indebtedness properly allocable
to a trade or business" of their own. See Rose v. Commissioner,
T.C. Memo. 1995-75. In Rose, the taxpayers paid interest on a
deficiency that arose from underpayment of estimated tax and late
payment of their tax. This was not produced by any adjustment to
their income but instead resulted solely from the taxpayers' late
payment of their tax liabilities. We concluded that that
interest was not attributable to a trade or business.
In the case at bar, petitioners' deficiencies for 1981 and
1982 resulted in part from a failure to remit taxes reported as
withheld on petitioner's Form W-2. As noted earlier, the Form
W-2 was prepared by petitioner himself. He did not receive a
Form W-2 from any individual or entity he may have worked for
during 1981 or 1982. Thus, he has not demonstrated any basis,
much less the good faith basis contemplated by Commissioner v.
Polk, 276 F.2d 601 (10th Cir. 1960), for believing that any tax
was withheld from his compensation and paid over to the Service
on his behalf. Petitioners have failed to show that interest on
their deficiencies, insofar as attributable to their overstate-
ment of withholding credits, arose as a natural, usual, or
unavoidable consequence of petitioner's business. Petitioners,
therefore, have failed to carry their burden of showing that the
interest imposed on their income tax deficiencies due to their
overstated credits for withholding was allocable to a trade or
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