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the production or collection of income and for the management,
conservation, or maintenance of property held for the production
of income. Petitioner submitted a Form 1098 for 1992 that showed
the following amounts were paid on the rental property: Mortgage
interest expense in the amount of $4,500, property taxes in the
amount of $1,414, and hazard insurance in the amount of $234.
Petitioner testified that he paid these expenses. We conclude
that petitioner established his entitlement to deduct the
foregoing expenses in addition to the deductions already allowed
by respondent.5
III. Self-Employment Tax
During 1992, petitioner had self-employment income from his
C.P.A. business in the following amounts: (1) $2,442 he reported
on the return, and (2) the disallowed Schedule C deductions.
Section 1401 imposes self-employment tax on self-employment
income. Section 1402(a) defines net earnings from self-
employment as the gross income derived by an individual from the
carrying on of any trade or business by such individual less
allowable deductions attributable to such trade or business.
Petitioner did not dispute that his C.P.A. business income
was subject to self-employment tax. Instead, petitioner argued
5 We note that the disallowance of deductions claimed for
other expenses creates additional income for petitioner, and
petitioner should report one-half of the income pursuant to Texas
community property laws. See Tex. Fam. Code Ann. secs. 3.001,
3.002 (Vernon 1998); see also our discussion regarding sec.
66(b), supra.
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