Merlin A. and Dee D. Steger - Page 2




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               WELLS, Judge:  This case was assigned to Special Trial Judge           
          Robert N. Armen, Jr., pursuant to Rules 180, 181, and 182.1  The            
          Court agrees with and adopts the Opinion of the Special Trial               
          Judge, which is set forth below.                                            
                         OPINION OF THE SPECIAL TRIAL JUDGE                           
               ARMEN, Special Trial Judge:  Respondent determined a                   
          deficiency in petitioners' Federal income tax for the taxable               
          year 1993 in the amount of $1,260.  After concessions by                    
          petitioners,2 the issue for decision is whether petitioners are             
          entitled to deduct the entire cost of nonpracticing malpractice             
          insurance paid during the year in issue.  We hold that they are.            
                                  FINDINGS OF FACT                                    
               This case was submitted fully stipulated under Rule 122, and           
          the facts stipulated are so found.  Petitioners resided in Des              
          Moines, Iowa, at the time that their petition was filed with the            
          Court.                                                                      
               Petitioner husband (petitioner) is a lawyer.  During the               
          year in issue, he practiced as a self-employed attorney and                 
          reported his income for the year on a Schedule C.                           


          1  All Rule references are to the Tax Court Rules of                        
          Practice and Procedure, and all section references are to the               
          Internal Revenue Code in effect for the taxable year in issue.              
          2  Petitioners concede:  (1) They failed to report interest                 
          income in the amount of $207, and (2) respondent properly reduced           
          petitioner husband's Schedule C deduction by the amount of                  
          $1,447.                                                                     




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