Susan L. Bay - Page 3

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          investment management companies, accountants, and attorneys.  The           
          trust paid or incurred the expenses related to such services.               
          Petitioner's proportionate shares of these expenses amounted to             
          $19,274 for 1993 and $28,984 for 1994.                                      
               In computing her taxable income for each year in issue,                
          petitioner elected to itemize her deductions.  On Schedules A               
          included with her 1993 and 1994 Federal income tax returns,                 
          petitioner claimed her proportionate shares of the trust expenses           
          as "Other Miscellaneous Deductions" as detailed below:                      

                                                 1993         1994                    
               Misc. expenses                     $19           $9                    
               Rent expense                       106          374                    
               Investment fees                 10,335       15,323                    
               Travel expense                      36        1,066                    
               Investment custodial fees        2,683        3,494                    
               Professional fees                6,080        1,701                    
               Telephone expense                  ---           64                    
               Atty. and acct. fees               ---        6,836                    
               Other depreciation                  15          117                    
               Total                           19,274       28,984                    

               In the notice of deficiency, respondent reduced the totals             
          of the above deductions by 2 percent of petitioner's adjusted               
          gross income for the appropriate year, made other computational             
          adjustments, and determined the deficiencies here in dispute                
          accordingly.                                                                










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