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OPINION
I. Income Inclusions
A. 1998 and 1999
The parties stipulated7 that petitioner worked for Watson,
Inc., in 1998 and 1999, and petitioner does not dispute his
receipt of the amounts reflected as wages or other compensation
on the Forms W-2 and 1099-MISC issued by Watson, Inc., for those
years. Whether petitioner constituted an employee of Watson,
Inc., or performed services for that company as a “private
independent contractor” (petitioner’s position), he was in
receipt of either “compensation for services” or “gross income
derived from business” includable in his gross income under
either section 61(a)(1) or section 61(a)(2). His failure to
include in income the amounts received from Watson, Inc. ($48,000
for 1998 and $14,400 for 1999), was improper.
It is also stipulated that petitioner received from Mobil
Pension Trust Forms 1099-R reflecting gross distributions to him
of $1,114.04 and $3,342.12 for 1998 and 1999, respectively, and
7 The stipulations are identified as either “Respondent’s
Stipulations” (1-16) or “Petitioner’s Stipulations” (17-36).
Petitioner reserved the right to object to respondent’s
stipulations 3-16, and respondent reserved the right to object to
all of petitioner’s stipulations. At the trial, petitioner
stated that he had no objections to respondent’s stipulations 3-
16, and respondent did not raise any objection to petitioner’s
stipulations. The stipulation of facts was thereupon received
into evidence without objection. Therefore, we consider the
stipulations to be the parties’ joint stipulation of facts.
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Last modified: November 10, 2007