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Agency during 1987. We therefore sustain respondent's determina-
tion on that issue.5
Self-Employment Tax
Respondent determined that petitioners are liable for self-
employment tax of $5,387 for 1987. In order to refute that
determination, petitioners rely on the evidence they presented
and the argument they make with respect to whether Mr. Hardtke
had compensation income from Agency for 1987. We have found that
petitioners failed to satisfy their burden of proof on the
compensation issue. Consequently, they have failed to meet their
burden of proving error in respondent's determination regarding
petitioners' liability for self-employment tax for 1987. See
Rule 142(a); Welch v. Helvering, 290 U.S. at 115. Accordingly,
we sustain that determination.
Additions to Tax
Respondent determined that petitioners are liable for 1987
for the additions to tax for negligence under section
5 Although respondent argues that certain amounts that Mr.
Hardtke received during 1987 from Dinan that were characterized
on the books and records of Dinan as "Loan Payable-Officers"
actually represented, at least in part, indirect payments of
compensation from Agency and petitioners argue that those amounts
were in fact repayments of loans, and not compensation, we need
not decide that dispute. This is because resolution of that
dispute is not necessary to our conclusions herein. All that is
necessary is whether the compensation that Agency paid during
1987 to Dinan for services performed by Mr. Hardtke was earned by
Mr. Hardtke, rather than by Dinan, under the two-prong test
enunciated in Johnson v. Commissioner, 78 T.C. 882, 891 (1982),
affd. without published opinion 734 F.2d 20 (9th Cir. 1984).
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