Raymond Verni Schroeder - Page 9

          Furthermore, petitioner could not recall what the largest                   
          expense, repairs and maintenance, represented.                              
               Based upon our review of the relevant factors, we find that            
          petitioner was compensated as an independent contractor by Astron           
          during 1993.  Therefore, petitioner's net earnings therefrom are            
          subject to self-employment tax.  Respondent is sustained on this            
          Social Security Benefits                                                    
               Section 86(a) provides that gross income includes Social               
          Security benefits in the amount equal to the lesser of: (1) One             
          half of the Social Security benefits received during the year; or           
          (2) one-half of the excess of the sum of (a) modified adjusted              
          gross income and (b) plus one-half of the Social Security                   
          benefits received over the base amount.  The base amount for                
          taxpayers filing a joint return for 1993 is $32,000.  Sec.                  
          86(c)(1)(B).  For 1993, petitioner's modified adjusted gross                
          income equals adjusted gross income.  See sec. 86(b)(2).                    
               Petitioner argues that the calculation pursuant to section             
          86 does not result in the inclusion of any Social Security                  
          benefits in income for 1993.  The sum of one-half of the Social             
          Security benefits received, $10,687, and modified adjusted gross            
          income for 1993, $32,251,5 equals $42,928.  This amount exceeds             

          5    This includes additional wage income of $170 and allowing a            
          deduction of $2,096 for one-half of the self-employment taxes               
          determined by respondent.                                                   

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