Charles E. Shepherd - Page 2

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               1.  Whether petitioner is entitled to deductions for                   
          business expenses.  We hold that he is to the extent provided               
          below.                                                                      
               2.  Whether petitioner is entitled to certain itemized                 
          deductions.  We hold that he is to the extent provided below.               
               3.  Whether petitioner is entitled to a credit for Federal             
          tax paid on fuel.  We hold that he is not.                                  
               4.  Whether petitioner is liable for an accuracy-related               
          penalty.  We hold that he is.                                               
               Petitioner resided in Evanston, Illinois, at the time he               
          filed his petition.  During 1993, petitioner worked as a                    
          traveling salesperson, driving to various sites and selling                 
          peanuts, candy, soda, pastries, and other snacks out of his                 
          automobiles.  He also sold Bibles and secondhand clothing.                  
               Petitioner filed in a timely manner his 1993 Federal income            
          tax return.  On Schedule C of the return, he reported $61,250 of            
          gross receipts, $11,975 of "other income" (i.e., relating to fuel           
          credits), and $37,100 of expenses.  On Schedule A, he claimed               
          $27,018 of deductions.  In the notice of deficiency, respondent             
          disallowed all of petitioner's Schedule C expenses and the                  
          following Schedule A deductions:  $4,100 of taxes, $3,300 of                
          charitable contributions, $13,850 of casualty losses, and $1,000            
          of miscellaneous deductions.  In addition, respondent disallowed            







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