John K. Jorman, Jr. and Audrey Jorman - Page 5

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               Expenses of getting a new lease               595.00                   

               Total claimed deduction                     3,897.18                   

               In addition to his employment with PSI during 1991,                    
          petitioner also maintains that he was in some trade or business             
          related to the real estate industry.  Petitioner held licenses to           
          appraise, broker, and sell real estate during the year in issue.            
          A Schedule C included with petitioners' 1991 return reflects the            
          following items:                                                            
               Gross receipts                -0-                                      
               Gross income                  -0-                                      
               Car and truck expenses        $10,000                                  
               Office expense                4,345                                    
               Taxes and licenses            50                                       
               Other expenses                                                         
                    Materials                4,100                                    
                    Journal                  78                                       
               Total expenses                18,573                                   
               Net loss                      18,573                                   

               Petitioner provided little detail as to how the specific               
          amounts of the deductions were computed.  He did testify that the           
          automobile deduction related to a 1978 Buick Regal and a 1980               
          Oldsmobile Cutlass, vehicles that were acquired by petitioners              
          prior to 1991.  He also testified that included in office                   
          expenses were items such as cable television services fees,                 
          newspaper and magazine subscriptions, and the costs of acquiring            
          a sofa, computer table, and other items of furniture, as well as            
          a portion of the rent paid on his Kokomo apartment.  Petitioner             

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