Estate of Betty Bodwell - Page 10




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          income and deductions attributable to such trade or business                
          shall be treated, for purposes of self-employment tax, as the               
          gross income and deductions of the husband, unless the wife                 
          exercises substantially all of the management and control of such           
          trade or business, in which case all such gross income and                  
          deductions shall be treated as hers.  Accordingly, under section            
          1401, the spouse deemed to have management and control of the               
          business activity is subject to self-employment tax, and the tax            
          is computed on the total gross income less the total deductions             
          of the business, notwithstanding the attribution of one-half of             
          the income to the other spouse for income tax purposes.                     
               It is uncontested that petitioner, d.b.a. PAINT-SER LTD.,              
          managed and controlled the performance of the painting services             
          associated with PAINT-SER LTD.  On the basis of the record and              
          sections 1401 and 1402(a)(5), we find that all the self-                    
          employment tax liability for the years 1989 through 1994 is                 
          attributable to the business managed and controlled by                      
          petitioner, and that he is liable for self-employment tax during            
          the years in issue on the income earned from these services.                
          Issue 3.  Failure To File Timely Tax Return or To Pay Tax                   
               Respondent determined that the addition to tax for failure             
          to file timely a tax return was applicable for each of the years            
          in issue.  It is uncontested that petitioners did not file tax              
          returns for any of the years in issue.  An income tax return must           






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