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expenses would already be allowed and provided for in the
reconstruction of petitioners' restaurant income. And, in fact,
petitioners did report on Schedules C interest expenses of $9,938
for 1992 and $12,100 for 1993. Thus, to both allow deductions for
these interest expenses on Schedules C and for trade or business
interest expenses on Schedules A would amount to the allowance of
double deductions. Consequently, respondent's determination
disallowing $12,221 of interest expenses for 1992 and $10,277 of
interest expenses for 1993 is sustained.
Issue 4. Failure To File Additions to Tax
The fourth issue for decision is whether petitioners are
liable for the addition to tax pursuant to section 6651(a)(1) for
failing to timely file their income tax returns for each of the
years in issue.
Section 6651(a)(1) imposes an addition to tax of 5 percent for
each month or fraction thereof in which an income tax return is not
filed after the prescribed filing date. An exception is made for
reasonable cause not due to willful neglect.
Although the record on this issue is vague, petitioners
concede that they did not timely file their tax returns for the
years in issue. Respondent contends that the 1992 return was filed
on August 18, 1993, the 1993 return was filed on June 1, 1994, and
the 1994 return was filed on May 14, 1995.
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