Sony and Gwendolyn A. Jean Baptiste - Page 5




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          amended 1994 return which included a Schedule C for petitioner’s            
          truck driving.  On the Schedule C, petitioners reported gross               
          income of $10,300; they arrived at this amount by adding $8,981,            
          the gross earnings to date listed on the April 30, 1994, computer           
          printout, to $1,319 which petitioner received from Ortega that              
          May.  Petitioners claimed the following expenses:                           
                    Expense                       Amount                              
                     Taxes and licenses             $650                              
                     Travel                          350                              
                     Wages                         1,190                              
                     Uniforms                         27                              
                     Fuel                            804                              
                     Beeper                           72                              
                     Tools                           150                              
                     Truck rent                    1,878                              
                     Unpaid dispatch               1,690                              
                     Total                         6,811                              
          Petitioners reported a net profit of $3,489 and self-employment             
          tax of $493.4  Petitioners did not provide any additional                   
          documentation to substantiate these expenses.  Both the original            
          and amended 1994 returns were prepared by H & R Block.                      
               In 1995, petitioners filed a claim against Mr. Ortega for              
          $5,000 in small claims court.5  Petitioners won their case, but             
          Mr. Ortega never paid.  Respondent attempted to serve Mr. Ortega            

               4  Because of our holding in this case, respondent’s                   
          determination of increased self-employment tax (and the                     
          concomitant self-employment tax deduction) will be recomputed               
          under Rule 155.                                                             
               5  Subsequent to trial, petitioners filed a motion to                  
          supplement the record primarily to submit copies of documents               
          relating to this court action.  Respondent filed an objection               
          thereto.  Upon review, we shall grant petitioners’ motion and               
          receive the additional documents.  They have only been relied               
          upon for our finding as to dates and the amount claimed by                  
          petitioners.                                                                


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