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flower shop for $18,000 in 1991, yet petitioners failed to make
any attempt to recover some of the proceeds received from the
sale. Petitioners failed to persuade us that their friendship
with the Christophers was not the main reason for the refusal to
press them for payment. Petitioners also failed to show, among
other things, whether the Christophers lacked assets, were in ill
health, had filed for bankruptcy, were insolvent, or were
incapable of paying their debt for some other reason. In short,
petitioners have not shown that collection efforts would have
been futile. Their belief that the debt was worthless and their
choice not to pursue reasonable collection efforts are
insufficient to establish worthlessness.
Accordingly, we hold that petitioners have failed to prove
that the debt which the Christophers owed them became worthless
in 1990. Therefore, they are not entitled to a nonbusiness bad
debt deduction in that year.
III. Self-Employment Taxes on Residual and Renewal Insurance
Premiums
Section 1401 imposes a tax upon each individual's "self-
employment income". "Self-employment income" is defined in
section 1402(b) as "net earnings from self-employment" with
certain exceptions not relevant to this case. Net earnings from
self-employment are defined in section 1402(a) as "gross income
derived by an individual from any trade or business carried on by
such individual, less the deductions allowed by this subtitle
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