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all Rule references are to the Tax Court Rules of Practice and
Procedure.
After concessions,1 the issues to be decided involve the
substantiation of certain Schedule C business expense deductions
and Schedule A itemized deductions claimed by petitioners on
their 1991 joint Federal income tax return.2
FINDINGS OF FACT
Some of the facts have been stipulated for trial pursuant to
Rule 91. The parties' stipulations of fact are incorporated
herein by reference and are found as facts in the instant case.
At the time they filed their petition in the instant case,
petitioners Edgar Brown (Mr. Brown) and Doris Brown (Mrs. Brown)
resided in Lucedale, Mississippi. Petitioners filed a joint U.S.
Individual Income Tax Return (Form 1040) for the year in issue.
1 In the notice of deficiency, respondent determined that
petitioners had unreported income from Hercules, Inc., in the
amount of $21,429. Subsequently, the parties conceded that
petitioners have unreported income in the amount of $18,229.
Additionally, in the notice of deficiency, respondent
disallowed certain Schedule C business expenses of petitioners.
Subsequently, respondent conceded that petitioners are entitled
to business expense deductions in the amount of $10,949 for
insurance and in the amount of $543 for taxes.
2 On their 1991 return, petitioners claimed exemptions in the
amount of $10,750 and reported self-employment taxes in the
amount of $5,494. On the basis of adjustments in the notice of
deficiency, respondent reduced petitioners' exemption deduction
by $2,580 and increased petitioners' self-employment taxes by
$4,753. We sustain those computational adjustments to the extent
that they result from the Rule 155 computations that we order
below.
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