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sec. 62(a)(4), I.R.C., in computing Ps' adjusted gross
income.
Held, further, State nonresident income taxes are
not deductible as a trade or business expense under
sec. 62(a)(1), I.R.C. Tanner v. Commissioner, 45 T.C.
145 (1965), affd. per curiam 363 F.2d 36 (4th Cir.
1966), followed.
L. Robert LeGoy, Jr. and Kurt O. Hunsberger, for
petitioners.
Paul L. Dixon, for respondent.
OPINION
PARR, Judge: Respondent determined deficiencies of $3,955,
$5,379, and $3,983 in petitioners' Federal income taxes for the
taxable years 1993, 1994, and 1995, respectively. The sole issue
for decision is whether State nonresident income taxes paid on
net royalty income are deductible for purposes of determining
adjusted gross income. We hold they are not.
Background
This case was submitted fully stipulated under Rule 122.1
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. Petitioners resided in
1Unless otherwise indicated, 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 years at issue.
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