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The issues for decision are: (1) Whether petitioners are
entitled to deductions for expenses, under section 162(a),
incurred in connection with a medical research activity conducted
by Curtis G. Lockett (petitioner) during the years at issue, and
(2) whether petitioners are entitled to an itemized deduction,
under Schedule A, for job expenses and other miscellaneous
expenses for the year 1991.2
Some of the facts were stipulated. Those facts, with the
exhibits submitted therewith, are so found and are incorporated
herein by reference. At the time the petition was filed,
petitioners' legal residence was Mobile, Alabama.
For some 20 years prior to the years at issue, petitioner
was a home building contractor. Sometime during this period,
petitioner maintained a home laboratory for the purpose of
developing a medicine to treat his minor daughter who was
2
Petitioners conceded the failure to include in gross income
dividends for the year 1991. The parties agree that the correct
amount of the unreported dividend income is $94.52 instead of $96
as set out in the notice of deficiency. Petitioners also
conceded the failure to include in gross income for the year 1991
the $500 premature distribution of an individual retirement
account. Respondent determined, in the notice of deficiency, the
10-percent additional tax on early distributions from qualified
retirement plans under sec. 72(t). Although petitioners did not
expressly concede this adjustment, they presented no evidence and
did not address this issue at trial. Petitioners are deemed to
have waived this issue. The Court, therefore, determines that
adjustment against petitioners. Rule 149(b); Walker-Scott Corp.
v. Commissioner, 35 T.C. 34, 37 (1960). All other adjustments in
the notice of deficiency are computational, based upon the
Court's holding on the contested issues.
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