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The first issue for decision is whether petitioners are
entitled to Schedule C business expense deductions attributable
to petitioner's real estate activity in excess of amounts allowed
by respondent.
On a Schedule C attached to petitioners' 1992 return,
petitioner reported gross income from his real estate activity in
the amount of $43,915. He claimed business expenses paid in
connection with his real estate activity in the total amount of
$35,806. Respondent made adjustments in the statutory notice of
deficiency to nearly all of the claimed expenses. Although some
of the claimed expenses were wholly or partially disallowed,
respondent also allowed deductions for numerous expenses in
amounts in excess of the amounts claimed on the Schedule C. The
expenses discussed, infra, are the only ones which petitioner
addressed at trial. We deem petitioner to have conceded
respondent's adjustments to the claimed expenses which he failed
to address. Furthermore, respondent's counsel conceded at trial
that petitioner is entitled to deductions for advertising,
insurance, utilities, and postage in amounts in excess of the
amounts allowed in the statutory notice of deficiency:
Statutory Notice Conceded Total
of Deficiency at Trial Allowed
Advertising $1,332 $106 $1,438
Insurance 391 392 783
Utilities 223 480 703
Postage 255 254 509
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Last modified: May 25, 2011