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Petitioners claimed $5,184 as commissions expenses. A portion
of this amount represented offices expenses ($1,053), and the
balance represented commissions paid to other insurance agents
($4,131). In the notice of deficiency, respondent allowed all but
$2,006 of the claimed $5,184.
Petitioner testified that the disallowed $2,006 represented
payments to Edward Levenson, who obtained an insurance policy that
petitioner wrote and for which he received a commission.
Respondent, on brief, concedes that petitioner is entitled to a
deduction in the amount of $1,053 for office expenses and $2,006
for the payments to Mr. Levenson. Respondent now asserts that
$2,125 should be disallowed as commissions expenses ($5,184 -
($1,053 + $2,006)), claiming petitioner testified that he paid no
other commissions in 1992. Respondent misunderstands petitioner's
testimony; petitioner did not concede any part of the claimed
commissions expenses.
On the basis of respondent's concession that the $2,006 paid
to Mr. Levenson is deductible, and because that amount was the only
amount challenged in the notice of deficiency with regard to the
claimed $5,184 of commissions expenses, we hold that petitioners
are entitled to a Schedule C deduction for commissions expenses in
the amount of $5,184, as claimed.
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