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corporation is an S corporation, he, and not the corporation, is
liable for payment of income taxes on the resulting additional
income. See secs. 1363(a), 1366. Petitioner further points out
that, as the lessor of the boats to the corporation, he has
previously reported the amount of the boat lease payments as
income on his individual returns. Thus, he concludes,
disallowance of the deductions at issue results in his being
taxed twice on the same income.5 To prevent this result, he
argues that his individual income for the years at issue should
be reduced by the amount that he reported as boat lease income
(that is, net of deductions previously claimed by him against
that income).6
We note at the outset that petitioner is selective in his
objection to double taxation. On the returns as filed for the
years at issue, petitioner took positions with respect to the
5 We note that the additional income of petitioner’s S
corporation resulting from the disallowance of the boat lease
deductions does not equal the boat lease net income reported by
petitioner in his individual capacity, because petitioner took
deductions for repairs, maintenance, insurance, interest, taxes,
docking fees, and depreciation against the boat lease income
reported on his individual returns.
6 At trial petitioner submitted amended returns for the
years at issue, apparently reflecting the removal of net boat
lease income (after deductions previously taken for interest,
maintenance, depreciation, etc.) from his individual returns. We
treated these submissions as petitioner's motion for leave to
amend petition, which we granted to permit consideration of
petitioner’s claim that his income should be reduced by the
amount reported as net boat lease income.
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