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invoices 0016 through 0019 within 30 days after Olin Ordnance
first received each such invoice during 1995 was that Mr. Palmer
did not want Olin Ordnance to make any such payment to him during
that year.
At all times during the performance of the Marion plant/
Palmer consulting agreement, both before and after the execution
of the July 1995 amendment, Olin Ordnance was ready, willing, and
able to pay Mr. Palmer the amount that it owed to him with respect
to each of his approved monthly invoices within 30 days after it
first received each such invoice.
Olin Ordnance issued Form 1099-MISC (Form 1099), Miscella-
neous Income, to Mr. Palmer, which showed that Mr. Palmer received
$52,894.31 of nonemployee compensation from Olin Ordnance during
1995. The $52,894.31 amount reported by Olin Ordnance in Form
1099 equals the total amount of the payments that Olin Ordnance
made to Mr. Palmer during 1995 with respect to his approved
monthly invoices 0008 through 0010, which included $5,100 of
Loomis residence monthly payments.10
Petitioners, cash basis taxpayers, filed a joint Form 1040,
U.S. Individual Income Tax Return (joint return), for the year at
issue. In Schedule E, Supplemental Income and Loss, of the joint
10There is one cent difference between the amount of
nonemployee compensation reported by Olin Ordnance in Form 1099
and the total amount that it paid to Mr. Palmer with respect to
his approved monthly invoices 0008 through 0010. For convenience,
we shall ignore that difference.
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