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secretary, spent most of his time, and earned his livelihood.
For the reasons discussed herein, we sustain respondent's
determination on this issue.
Issue 4. Unreported Interest Income
For 1980, respondent determined that petitioner failed to
report interest income of $853 from the Irving Trust Co.
Petitioner asserts that he received $2,291 of interest income in
1980 and that he correctly reported that amount on his 1980
Federal income tax return.
As a general rule, interest received by or credited to a
taxpayer within the taxable year, including interest on savings
or other bank deposits constitutes gross income and is fully
taxable. Sec. 1.61-7, Income Tax Regs.
At trial, respondent submitted five Forms 1099 totaling
$1,429 (the Forms 1099) to establish that petitioner has
unreported income of $853 for 1980. However, the Forms 1099 on
which respondent relies refer to 1979, not to 1980. Moreover,
none of the Forms 1099 are from the Irving Trust Co.
Accordingly, we hold that petitioner correctly reported his
interest income for 1980.
Issue 5. Theft Loss
As a general rule, in computing taxable income, a taxpayer
may deduct, pursuant to section 165(a), any loss sustained during
the taxable year, including a loss arising from theft which is
not compensated by insurance or otherwise, if the taxpayer meets
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