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to each of petitioners' joint income tax returns for 1990,
1991, and 1992 is a Schedule C, Profit or Loss From
Business, designated "Ambulatory Medical Clinic". On each
Schedule C, petitioners claimed a deduction for advertising
expenses which included the telephone services described
above. The advertising deductions claimed on their
Schedules C, and the portion of each deduction attributed
to petitioner's telephone services are as follows:
Tax Advertising Portion for
Year Deduction Telephone Services
1990 $6,448 $3,328
1991 16,535 15,600
1992 18,141 17,169
41,124 36,097
The deductions claimed for telephone services did not
involve an outlay of cash or property by petitioners, but
are based upon the value Dr. Remy ascribed to the
professional services for which he was not compensated.
Petitioner computed the value of the telephone services
deducted in 1990 by estimating the number of telephone
calls he received during the year, and multiplying that
number by $15, a minimum charge for his medical services.
Petitioner computed the value of the telephone services
deducted in 1991 by estimating the number of calls he
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