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qualified or unqualified pension plans are not included among the
enumerated expenses that may be deducted from net earnings from
self-employment.
Also, section 1402(a)(13) specifically excludes from the
calculation of net earnings from self-employment a limited
partner's distributive share of income or loss from a
partnership.
Petitioners' theory for claiming Schedule C deductions with
respect to the deposits into petitioner’s stock brokerage account
is not entirely clear. Petitioners apparently argue that in 1990
and 1991 petitioner’s $30,000 deposits into petitioner's stock
brokerage account (subject to the percentage limitations
reflected in petitioners’ amended joint income tax returns)
represented deductible Schedule C payments to petitioner’s PC.
Petitioners' theory for claiming a Schedule C deduction on their
1991 joint Federal income tax return with respect to the claimed
partnership loss is incomprehensible.
Respondent, among other things, argues that petitioner's
deposits in 1990 and 1991 into the stock brokerage account and
the claimed partnership loss for 1991 should be reflected, if
anywhere, not as deductions on Schedule C but respectively on
lines 17 and 18 of petitioners’ joint Federal income tax returns
(Forms 1040) where they would not reduce petitioners' self-
employment income.
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Last modified: May 25, 2011