- 2 - our consideration are: (1) Whether petitioner has shown that she is entitled to deduct any part of the $459,650 that she claimed as commissions and fees, and (2) whether petitioner is liable for the penalty and addition to tax determined by respondent. FINDINGS OF FACT Petitioner resided in Pomona, California, at the time her petition was filed in this case. Her 1992 Federal income tax return was filed on April 18, 1994. On Schedule C, petitioner reported gross receipts of $1,014,498.29 from her business as a “Dress Maker” operating under the name “California Fashion”. After accounting for returns and allowances and cost of goods sold, a gross income of $534,009.26 was reported. Among other expenses, petitioner claimed commissions and fees in the amount of $459,650. The sole adjustment by respondent to petitioner’s Schedule C reporting was the disallowance of the entire amount claimed for commissions and fees. Petitioner’s business involved the manufacture of dresses on a piecework basis. Jose Antonio Garcia Juarez2 was employed by petitioner during 1992. He was paid approximately $200 to $220 per week, he worked long hours, and he knew how to perform all tasks involved in the operation of the business. Mr. Juarez did not share in petitioner’s business profits for 1992. At some 2 Mr. Juarez has also been known as Mr. Garcia in portions of the record.Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011