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ate adjustments for the 2-percent adjusted gross income limita-
tion for miscellaneous deductions under section 67(a)2 and the 3-
percent adjusted gross income limitation under section 68(a).3
Respondent also determined, inter alia, in the notice for 1992
that certain interest income that Mr. Hawthorne received during
that year and reported in Schedule C of petitioners' 1992 return
is Schedule B interest income for that year.
In the notice issued to petitioners for 1993 and 1994,
respondent, inter alia, disallowed all of the expenses that
petitioners claimed in Schedules C of their returns for those
years because petitioners did not establish that those expenses
were ordinary and necessary expenses incurred in the ordinary
course of business. Respondent did not allow petitioners to
include any of those disallowed Schedule C expenses as Schedule A
deductions for 1993 and 1994.
OPINION
Petitioners bear the burden of proof on the issues pre-
sented. Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115
(1933). Petitioners attempted to satisfy their burden of proof
through testimonial and documentary evidence. Except for ex-
tremely limited testimony from Ms. Hawthorne, Mr. Hawthorne was
2 All section references are to the Internal Revenue Code in
effect for the years at issue. All Rule references are to the
Tax Court Rules of Practice and Procedure.
3 Respondent conceded at trial that $2,775.04 of real estate
taxes that petitioners claimed in Schedule C of their 1992 return
and that respondent allowed in Schedule A are not subject to the
2-percent adjusted gross income limitation for miscellaneous
deductions under sec. 67(a).
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