James Luther Cochrane - Page 14

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          Respondent announced that she would rely upon the deemed                    
          admissions, which we incorporate herein by this reference.4                 

                                     Discussion                                       

          Deficiencies for the Taxable Years in Issue                                 

               For purposes of convenience, we will combine our findings of           
          fact and opinion.                                                           
               During the years in issue, petitioner resided in Chula                 
          Vista, California, U.S.A.  From 1983 through 1985, petitioner               
          worked as an engineering technician for General Dynamics Corp. in           
          San Diego, California.  In 1983, petitioner worked for Rohr                 
          Industries, Inc., in Chula Vista, California.  During 1983, 1984,           
          and 1985, petitioner received wages from General Dynamics Corp.             
          in the amounts of $4,729.40, $30,359.84, and $6,206.99,                     
          respectively.  Petitioner received $13,223.05 in wages from Rohr            
          Industries, Inc., in 1983.                                                  
               On his Federal income tax returns for 1983 through 1985,               
          petitioner reported these wages and claimed that they were                  
          excludable from gross income as foreign earned income.  See sec.            
          911(a) and (b).  Petitioner's apparent position is that the State           
          of California is not part of the United States.  Courts have long           

               4We have often decided cases on the basis of deemed                    
          admissions.  See, e.g., Marshall v. Commissioner, 85 T.C. 267,              
          271 (1985); Doncaster v. Commissioner, 77 T.C. 334, 336 (1981);             
          Freedson v. Commissioner, 65 T.C. 333, 335 (1975), affd. 565 F.2d           
          954 (5th Cir. 1978).                                                        




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