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Based on the foregoing, we hold that respondent has proven a
substantial omission of income within the meaning of section
6501(e)(1)(A) by negating the only unagreed nontaxable source
alleged by petitioner. Petitioner does not dispute that
unreported bank deposits and cash expenditures in the amounts of
$30,763.94 and $84,948.89 for 1989 and 1990, respectively, if
found to be improperly omitted from gross income, are subject to
ordinary income taxes. Petitioner does not now claim any
deduction or losses not allowed by respondent. Therefore, we
hold that petitioner is liable for deficiencies in income tax for
1989 and 1990, the correct amount of which will be calculated
under Rule 155.
II. Respondent's Determination of Self-employment Tax
Respondent further determined that petitioner's omitted
gross income was subject to self-employment taxes pursuant to
section 1401 for 1989 and 1990. Section 1401 imposes a tax on
self-employment income that is in addition to other applicable
taxes. Section 1402(b) generally defines self-employment income
as net earnings from self-employment derived by an individual.
The term "net earnings from self-employment" means gross income
derived by an individual from any trade or business carried on by
such individual, less allowable deductions attributable to such
trade or business, plus certain items not relevant here. Sec.
1402(a). The term trade or business for purposes of the self-
employment tax generally has the same meaning it has for purposes
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