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for 1983, 1985, and 1986, respectively. Petitioner claimed
deductions of $137,000 for "write-offs" on his tax return for
1982, $6,300 and $19,229 for bad debts on his tax returns for
1983 and 1984, respectively, and $36,451 for loan or investment
loss on his tax return for 1985. On other items listed on the
Schedules C of his tax returns, petitioner spent $58,874 for
1982; he claimed deductions of $18,872 for 1983, $14,137 for
1984, $14,799 for 1985, and $5,426 for 1986. Large portions of
these other items may fairly be described as office expenses.
_________________________________
Respondent exercised due care and diligence in ascertaining
petitioner's correct mailing address before mailing the notice of
deficiency to petitioner on September 14, 1990. The notice of
deficiency was mailed to petitioner's last known address.
Respondent's use of the Consumer Price Index method of
royalty income reconstruction for 1983 was reasonable.
The Corporations were corporations and remained corporations
throughout the years in issue. The expenses of the Corporations
are not expenses of petitioner's trade or business.
Petitioner's office expenses that are deductible expenses of
his trade or business are in the following amounts: For 1982--
$27,000, for 1983--$8,000, for 1984--$5,000, for
1985--$3,000, and for 1986 $1,000.
Petitioner was negligent in preparing his tax returns for
1983 through 1986.
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