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is $20,624. This amount is $3,000 less than the $23,624 of
depreciation and section 179 expense deductions claimed by
petitioner on the Schedule C and the Schedule E.
In the statutory notice of deficiency dated September 16,
1997, respondent disallowed $3,000 of the $14,624 depreciation
and section 179 expense deduction claimed on the Schedule C. The
$11,624 amount which was allowed by respondent includes all of
the amounts listed on the self-prepared reports, with the
exception of the $9,000 section 179 expense deduction listed on
the Section 179 Expense Report as "From K-1's". Respondent also
disallowed in the statutory notice of deficiency the entire
Schedule E loss claimed by petitioner, including the $9,000
section 179 expense deduction. The property for which the $9,000
was claimed is not listed anywhere on petitioner's return or the
attachments to her return. The only Schedule K-1 attached to her
return lists her share of Master Plan's section 179 expense
deduction as zero.
The parties submitted a copy of Master Plan's Federal income
tax return (the Form 1120S) for its taxable year ended December
31, 1994. Although the Form 1120S and its attachments contain a
great number of erroneous entries and inconsistencies, it appears
that Master Plan elected on a Form 4562 attached to the Form
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Last modified: May 25, 2011