Kenneth & Linda J. Logie - Page 4

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          use in 1994 in the total amount of $1,396.  In addition,                    
          petitioners claimed various itemized deductions, including                  
          medical and dental expenses in the amount of $11,976.                       
               During 1994, Mr. Logie received $6,445 in Social Security              
          benefits.  Petitioners did not report any Social Security                   
          benefits on their 1994 return.  Petitioners paid no self-                   
          employment tax on the compensation paid to them by the                      
          Interdenominational Gospel Chapel.                                          
               Respondent issued a notice of deficiency determining a                 
          deficiency in petitioners' joint Federal income taxes in the                
          amount of $14,322 for 1994.  In the notice of deficiency,                   
          respondent disallowed both the exclusion from income and the                
          adjustment to income for the claimed parsonage allowance.                   
          Respondent disallowed the duplicative Schedule C deduction for              
          supplies expense in the amount of $1,400.  Respondent also                  
          disallowed $1,102 of the total $1,396 petitioners claimed as                
          Schedule C deductions for telephone expenses, on grounds that               
          petitioners failed to show that the amount disallowed was not a             
          personal expense.  Respondent did not challenge petitioners'                
          claimed medical and dental expenses or other itemized deductions.           
               Respondent also determined a deficiency in petitioners'                
          self-employment taxes for 1994 in the amount of $5,213, and                 
          allowed a corresponding income tax deduction in the amount of               
          $2,607.  In addition, respondent determined that petitioners were           

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