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Unless otherwise indicated, section references are to the
Internal Revenue Code in effect for the year in issue, and all
Rule references are to the Tax Court Rules of Practice and
Procedure.
After concessions by the parties,1 the issues for decision
are: (1) Whether petitioners are entitled to deduct an aggregate
partnership loss carryover in the amount of $3,313,240 for the
1994 taxable year;2 (2) whether petitioners are entitled to
deduct charitable contributions in the amount of $2,024 for the
1994 taxable year; and (3) whether petitioners are liable for the
accuracy-related penalty pursuant to section 6662(a) for 1994.3
Petitioners filed a timely petition with this Court. At the time
of filing the petition, petitioners resided in Yarmouth, Maine.
1 Petitioner Wayne Johnson concedes he is liable for
self-employment tax, and respondent concedes petitioners are
entitled to a credit for one-half the self-employment tax paid.
2 Neither party has questioned the Court’s jurisdiction
to adjudicate the partnership loss in this deficiency proceeding,
and we therefore assume that the partnerships are small
partnerships within the meaning of sec. 6231(a)(1).
3 The notice of deficiency contains adjustments to
petitioners' medical expense deduction and earned income credit.
These are computational adjustments which will be affected by the
outcome of the other issues to be decided, and we do not
separately address them.
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