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Dividends in Stock Under Dividend Reinvestment Programs
Prior to the years at issue, petitioners enrolled in the
respective dividend reinvestment programs of various companies in
which they owned shares of stock. Pursuant to those programs,
petitioners elected to receive dividends on those shares in
stock, rather than in cash. Pursuant to those elections, peti-
tioners received dividends in the amounts of $8,324.76,
$8,123.74, and $8,759.81 during 1992, 1993, and 1994, respec-
tively, that were paid in stock. They reported those respective
amounts as dividend income in their returns for those years.
Schedule C Income and Expenses Claimed by Petitioners
Schedule C Income Claimed by Petitioners
Around 1980, Mr. Hawthorne sold a motel and reported no gain
from that sale. Pursuant to the terms of the real estate con-
tract relating to that sale, Mr. Hawthorne received $1,957.68 in
interest income during 1992. Petitioners reported that income in
Schedule C of their 1992 return. Petitioners did not report any
other income in that Schedule C or in the Schedules C of their
1993 and 1994 returns.
Schedule C Expenses Claimed by Petitioners
Mr. Hawthorne owned one or more real properties (properties)
in different locations throughout the United States, including
Cape Coral, Florida; Pagosa Springs, Colorado; and Elephant
Butte, Santa Fe, and Albuquerque, New Mexico. Mr. Hawthorne and
petitioner Donelle C. Hawthorne (Ms. Hawthorne) owned one prop-
erty in Cape Coral, Florida, as community property. At least
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