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Federal income tax returns. Petitioner and her former husband
separated in 1993 and were divorced in 1994.
From 1989 through the date of trial, petitioner never
realized or reported on a Federal income tax return a net profit
from the activity. The income and expenses with respect to the
activity reported on petitioner's Federal income tax returns from
1993 through 1996, inclusive, are summarized in the following
table:
Year Income Expenses Net Loss
1993 $ 525 $29,142 $28,617
1994 375 19,111 18,736
1995 350 14,670 14,320
1996 250 7,104 6,854
On her 1993 Schedule C petitioner reported the following
items:
Income $525
Expenses
Advertising $ 891
Depreciation 7,903
Insurance 1,932
Interest 4,196
Repairs 2,431
Supplies 3,616
Tax 254
Travel, etc 5,071
Other 2,848 29,142
Net loss 28,617
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