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decision are:
(1) Whether petitioners failed to report $14,555 of Schedule
C, Profit or Loss From Business, income for the 1994 tax year;
(2) whether petitioners are entitled to deduct $2,035 for
travel expenses and $1,330 for meals under section 162 as
Schedule C business expenses; and
(3) whether petitioners are liable for the accuracy-related
penalty under section 6662(a).2
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulated facts and the related exhibits are incorporated
herein by this reference. At the time of filing the petition in
this case, petitioners resided in Irvine, California.
(...continued)
their landscaping business. They dispute, however, that this
income is subject to tax.
Respondent also determined that petitioners had overstated
their Schedule C, Profit or Loss From Business, deductions
relating to their landscaping business by $18,456. Respondent,
however, conceded $2,235 of these deductions, reducing the
overstated amount to $16,221. Petitioners then conceded $12,856
of that amount, leaving $3,365 in dispute.
Before the parties’ concessions, respondent determined that
petitioners were subject to additional self-employment income
taxes of $6,908 and entitled to an additional self-employment tax
deduction of $2,558. Petitioners presented no evidence at trial
regarding this issue and failed to address it on brief.
Petitioners are therefore liable for any self-employment income
taxes due on the additional self-employment income found by the
Court. See Petzoldt v. Commissioner, 92 T.C. 661, 698 (1989).
2 All 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.
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