- 48 -- 48 -
Cozzi v. Commissioner, 88 T.C. 435, 445 (1987). The test for
determining that point in time depends on a practical assessment
of all the facts and circumstances relating to the likelihood of
payment. Id.
Petitioners contend that no identifiable event occurred
during 1990 that made it clear that the Kabeiseman loans at issue
would never be repaid and that therefore petitioners were not
discharged from those debts during 1990 and have no income from
the discharge of indebtedness for that year. Respondent dis-
agrees.
On the instant record, we find that no identifiable event
occurred during 1990 that made it clear that petitioner never
would repay the respective outstanding balances of the Kabeiseman
loans. Indeed, the record establishes that during that year
petitioner repaid $9,689.80 of those loans.
Based on our review of the record before us, we find that
the respective outstanding balances of the Kabeiseman loans were
not discharged during 1990. Consequently, petitioners do not
have income for that year from the discharge of indebtedness.
Self-Employment Tax
Respondent determined that petitioners are liable for
self-employment tax for the years 1989 and 1990 because the
unreported income for those years is self-employment income.
Section 1401 imposes a self-employment tax on self-employment
income. Section 1402(b) generally defines self-employment income
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