Edward E. and Constance M. Thorpe - Page 1

                                 T.C. Memo. 1998-115                                  


                               UNITED STATES TAX COURT                                


                  EDWARD E. AND CONSTANCE M. THORPE, Petitioners v.                   
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

                     EDWARD E. THORPE AND COMPANY, Petitioner v.                      
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      


               Docket Nos. 23895-95, 23900-95.    Filed March 23, 1998.               


               Cheryl Frank and Chaya Kundra, for petitioners.                        
               Alan R. Peregoy, for respondent.                                       


                       MEMORANDUM FINDINGS OF FACT AND OPINION                        

               RUWE, Judge:  Respondent determined deficiencies in                    
          petitioners' Federal income taxes and accuracy-related penalties            
          in these consolidated cases as follows:                                     






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